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Tax recovery

01 July 2020

my client is composition dealer.he purchase goods from registered person.but he not file his gstr3b and not paid tax.Gst officer now demanding Gst from my client.my client is composition dealer and not claimed ITC which he has paid.But Gst officer not aggreed and want tax from my client.Can officer recover from us? please advice.

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3 Replies

Vijayprakash P (1313 Points)
Replied 01 July 2020

As per section 9(3)or 9(4) of CGST Act, Goods held in stock by a Composite Dealer have not been purchased from an unregistered dealer. In casehe has made purchase, tax must have been paid. He shall pay tax under reverse charge under section 9(3) or 9(4) on the inward supply of goods or service or both received.

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asif shaikh (190 Points)
Replied 01 July 2020

When purchase was made seller was registered. after some time he cancelled his registration.

Pankaj Rawat (GST Practitioner) (55052 Points)
Replied 02 July 2020

Dear Asif Shaikh

I agree with you in your case the tax officer cannot recover tax default by supplier in case the Recepeint has not avail the ITC or he is not liable to avail ITC.
As per section 155 of CGST the burden to proof ITC available is on Recepeint.
As per Section 43A (6) , Recepeint is liable only if he claimed ITC.