CBIC: Reasonable time to be given to explain discrepancy between GSTR-1 and 3B figures

GSTR-1 and 3B

Tax officers have agreed to provide businesses with a reasonable time to explain any discrepancy in numbers related to the sales return of GSTR 1 and the numbers in form 3B before taking any action for short payment or non-payment of tax.

New changes in GST law, which were applicable from 1st Jan 2022 gave the officers authority to initiate recovery proceedings against businesses that have deliberately shown higher sales in GSTR1 but have underreported numbers while paying tax under GSTR-3B. This move was introduced when it came to the notice of the authorities that many businesses were indulged in fake billing where they would show a higher number of sales in GSTR1 in order to claim input tax credit but repress the sales number in form 3B to lower GST liability. Earlier under the GST law, a show-cause notice was issued first and after that recovery process was initiated against the defaulter.

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