Businesses that have not filed GSTR-3B returns in the preceding two months will not be able to file details of outward supplies in GSTR-1 from September 1, GSTN has said.
While businesses file GSTR-1 of a particular month by the 11th day of the subsequent month, GSTR-3B, through which businesses pay taxes, is filed in a staggered manner between 20th-24th day of the succeeding month.
In an advisory to taxpayers from GSTN, which manages the technology backbone for Goods and Services Tax, said that Rule-59(6) of Central GST Rules which provides for restriction in filing of GSTR-1, will come into effect from September 1, 2021.
According to the rule, a registered person shall not be allowed to furnish the details of outward supplies of goods or services or both in Form GSTR-1, if he has not furnished the return in Form GSTR-3B for preceding two months.
For taxpayers filing quarterly return, GSTR-1 filing would be restricted if he has not furnished the return in Form GSTR-3B for preceding tax period.
This is a welcome move and well thought out restriction also a necessary control check to exclude the cases where taxpayers although report their supply invoices in GSTR-1 (due to constant follow ups from their parties) but they do not submit their corresponding GSTR-3B return through which tax is actually paid to government.
Genuine taxpayers will appreciate this move as till now their ITC was also at risk in case vendors do not file their GSTR-3B even though such invoice is appearing in GSTR-2A.
