Reverse credit

23. (1) Where input tax credit or input tax rebate has been enjoyed by a registered
dealer on purchases of such goods or such other purchases or purposes for which enjoyment
of input tax credit or input tax rebate is not permissible under section 22 of the Act
or these rules, the input tax credit or input tax rebate so enjoyed for such goods or part of
the goods shall be deducted from input tax credit or input tax rebate of the tax period in
which such event took place:
Provided that if, as a result of such deduction, there is a negative balance of input tax
credit or input tax rebate or net tax credit as referred to in sub-section (17) of section 22
for a particular tax period, the dealer shall pay such balance amount of tax forthwith as if
the same is payable in respect of such tax period.
(2) Where the goods purchased by a registered dealer are rejected or returned to the
selling registered dealer, the purchasing dealer shall reverse the input tax credit or input
tax rebate which he has enjoyed, if any, for purchase of such goods subsequently rejected
or returned and such reversal of input tax credit or input tax rebate shall be made at the
time of making payment of net tax payable for that tax period in which such goods were
returned or rejected.
(3) Where the goods, on which purchase tax is paid or payable by a registered dealer
under section 11 or section 12, is returned to the selling dealer, there will be no reversal or
adjustment of input tax credit or input tax rebate availed of on such goods.
(4) Where a registered dealer cannot keep separate account of purchase of goods for
the purpose of determining reverse credit under sub-rule (1), the input tax credit or input
tax rebate already enjoyed will be reversed in the following manner:
Y = [A x B / C] - X
Where-
‘Y’ = Input tax credit or input tax rebate to be reversed in the ‘tax period’;
‘A’ = Input tax credit or input tax rebate enjoyed in a ‘period’;
‘B’= Aggregate of sale price of goods for which reversal has been made till
the ‘preceding period’ including sale price of goods for which reversal
is to be made in the ‘tax period’;
‘C’ = total sale price of goods in that ‘period’; and
‘X’ = Input tax credit or input tax rebate reversed till the ‘preceding period’.
Explanation I – For the purpose of this rule, “period” means the period starting from
the first day of the year and ending on the last day of the month when the occasion of
reverse credit arises and “preceding period” means the period starting from the first day
of the year and ending on the last day of the month preceding the month for which reverse
credit is to be calculated.
Explanation II – Where the dealer has already reversed input tax credit or input tax
rebate in the same year on one or more earlier occasion or occasions, due credit of the
same shall be given while determining the reverse credit in a later occasion.

Please explain the formula of Reversal Credit of ITC in WB