Special Procedure – Rectification of Orders (Wrongly Availed ITC under Sec. 16(4))

Notification No.: 22/2024 – Central Tax
Date of Notification: 8th October 2024

Relevant Sections and Rules:

• Central GST Act, 2017:
  • Section 16(4), 16(5), 16(6) – Conditions and time limits for availing Input Tax Credit (ITC)
  • Section 73 & 74 – Determination of tax not paid/short paid or ITC wrongly availed/utilised
  • Section 107 & 108 – Appeals to Appellate Authority/Tribunal
  • Section 148 – Special procedure for certain registered persons
• CGST Rules, 2017 (Amended):
  • FORM GST DRC-08 – Uploading summary of rectified order under Section 73/74
  • FORM GST APL-04 – Uploading summary of rectified order under Section 107/108

Summary of Notification:

1. This notification, issued under Section 148, provides a special procedure for rectification of orders issued under Section 73, 74, 107, or 108 confirming demand of ITC wrongly availed due to contravention of Section 16(4), where such ITC has now become available under Section 16(5) or 16(6).
2. Eligible taxpayers: Registered persons against whom such orders have been issued, provided no appeal has been filed against the said order.
3. Procedure:
   • Taxpayers must file an application for rectification electronically on the GST portal within six months from the date of this notification (i.e., by 7th April 2025).
   • Along with the application, taxpayers must upload details in the proforma (Annexure A) covering demand details and bifurcation of eligible ITC now allowable under Section 16(5)/(6).
4. Rectification by Proper Officer:
   • The same authority who issued the original order will process the application and issue a rectified order within 3 months of application.
   • Rectified orders must be uploaded electronically:
     • In FORM GST DRC-08 for rectifications of orders under Section 73/74.
     • In FORM GST APL-04 for rectifications of orders under Section 107/108.
5. Scope of Rectification: Limited to ITC demands earlier disallowed under Section 16(4), but now available under Section 16(5) or 16(6).
6. Natural Justice: If rectification adversely affects the taxpayer, principles of natural justice must be followed before passing the rectified order.

Source: Notification No.: 22/2024 – Central Tax