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applicability of 2nd proviso of sec 16(2)
In respect of retention money withheld from payment to a supplier as per agreement, for a period exceeding 180 days, whether ITC has to be reversed? is the view that retention has not become due for payment as per contract and hence not payable until the period specified has not crossed holds good?
Replies (5)
The business agreement/contract Connot be override the Act , hence reversal is to be done if payment is made within 180 days
thank you for your valuable comment
sorry it's if payment is NOT made within 180
As rightly mentioned contract cannot overlap ACT. Reversal would be required.
But you try alternatives, if the retention is mapped with one final invoice and not with every invoice then the workflow would become easy without reversal mapping of each invoice.
Further company can explore to issue BankGuarantee instead of holding the payment. BG would help to satisfy the contract terms of retention.
But you try alternatives, if the retention is mapped with one final invoice and not with every invoice then the workflow would become easy without reversal mapping of each invoice.
Further company can explore to issue BankGuarantee instead of holding the payment. BG would help to satisfy the contract terms of retention.
Agree with Pankaj Sir's view...
Contract cannot override the Provision of Section 16(2) of the CGST Act 2017. ITC Reversal needs to be done if payment is not paid to the Supplier within a period of 180 days
Contract cannot override the Provision of Section 16(2) of the CGST Act 2017. ITC Reversal needs to be done if payment is not paid to the Supplier within a period of 180 days
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