September 30, 2022

Punjab finance minister writes to Sitharaman and calls for intervention in ITC case

Punjab Finance Minister Harpal Singh Cheema on Tuesday sought the intervention of Finance Minister Nirmala Sitharaman to consider the cancellation of input tax credit by registered taxpayers in the state for the settlement of the Integrated Goods and Services Tax (IGST).

In a letter to the Union Finance Minister, Cheema said that it has been observed that although registered taxpayers in the state have proceeded to cancel a huge amount of ITC, the same n had not been taken into account for the settlement of the IGST.

“A particular case has been identified of M/s HPCL Mittal Energy Limited which reversed ITC to the tune of Rs 223 crore in FY 2018-19, Rs 230 crore in FY 2019-20 and Rs 227 crore in the financial year 2020-21 respectively,” Cheema said.

He further informed that the said amount was not taken into account while initiating the settlement process of the IGST for the said period, thus depriving the State of its rightful share of the revenue.

“I have been informed that this issue has been constantly and consistently raised by my officers with the Indian government, but no solution has emerged so far,” Cheema said. Referring to the grave importance of the issue for the state revenue, Cheema urged the Union Minister that his personal intervention is of great importance in resolving this matter as soon as possible.

He said the importance of this issue resonates more strongly in light of the expiration of the GST compensation scheme