PATHANI LAW...SEC 17(5)(h) of CGST ACT
My clients sugar of rs 50 laks destroyed in flood. His N P is hardly 2%. To cover this loss, he has to do turnover of rs 25 cr. The Govt is not going to pay him a single rupee which it should do to support him.
Now the law will reverse his I T C of rs 245000 plus interest plus penalty.
Is it not a Pathani Law? We should point out this issue to F M.
Kishor.
7 Replies
Pankaj Rawat
(GST Practitioner)
(55052 Points)
Replied 18 August 2019
I .don't think ITC reversal is mandatory in case goods destroy due to natural calamities (Flood) , but if department asking .for reversal , then it's rediculous. Infact govt should support the business giving them relief grants & support them
Uttam
(employee)
(814 Points)
Replied 07 September 2019
unfortunately, as per law it looks like reversal is required.
Dasarath singh Rajpurohit
(40 Points)
Replied 07 September 2019
i hope that is not the intention of the law though
Uttam
(employee)
(814 Points)
Replied 07 September 2019
the wording of sec 17 (5) requires to be read strictly. So goods lost due to fire or natural calamity requires ITC reversal sadly.
Dasarath singh Rajpurohit
(40 Points)
Replied 07 September 2019
i hope there should not be any notice issued in this line. In case it is then it is against the nature of justice
Uttam
(employee)
(814 Points)
Replied 07 September 2019
In my opinion, you can reverse under protest and file appeal if you have received any notice. So that if the outcome is favourable that would help.
Dasarath singh Rajpurohit
(40 Points)
Replied 07 September 2019
yes,instead of reversal. reversa under protest would be safer one as mentioned above
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