Specific Procedure for Corporate Debtors Undergoing CIRP

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A corporate debtor enduring CIRP and whose assets are managed by IRP or RP should follow the following procedure. The period of compliance shall begin from the date of authorization of IRP/RP till the date on which they undergo corporate insolvency determination process. In this article, we will discuss on new GST Registration enables functionality for corporate debtors.

Procedure for Corporate Debtors. undergoing CIRP

1. Attain a new registration under the GST Act:

From the date of appointment of IRP/RP, such entities are dealt with as different persons. They are accountable to obtain new registration under each State/Union The territory where it was earlier registered.

2. ITR Filing under Section 40:

Such individuals are liable to file their first return as per Section 40 of the CGST Act. The IRP must file ITR Filing for applicable returns such as GSTR-3B during the period beginning from the date on which the company evolves liable for new registration till the date on which registration is granted.

3. Claim ITC:

Such persons can benefit (ITC) on all invoices bearing earlier GSTIN covering both goods and services. ITC can be helped as per the conditions stipulated under Chapter V of the CGST Act. There are two regulations imposed under the CGST Act on claiming ITC. These are as follows:

Section 16(4): It puts a constraint on availing ITC if such taxpayer has delayed ITR filing GSTR-3B for tax periods from July 2017 to March 2018.
It specifies a cap of 10% provisional ITC. Even a registered person receiving interests from such companies can claim ITC on invoices bearing the earlier GSTIN in compliance with the circumstances specified under Chapter V of the GST Act.

4. Pertaining for Refund:

Any the amount placed in the cash ledger of the earlier GSTIN by the IRP/RP is available for a refund from the date of nomination of IRP till the date of notification specifying a special procedure for corporate debtors withstanding insolvency. Such refund is available even if GSTR-3B/GSTR-1 returns are not filed for the said period. Read More about new GST Registration enables functionality for corporate debtors.