How to reply in asmt10 regarding excess claim itc?

Reply—As per newly inserted rule 36(4) of CGST Rules, input tax credit availed by a registered person shall not exceed 20% (amended upto 10%) of invoices or debit note uploaded by supplier in its GSTR-1. If supplier is required to file quarterly return, input can be claimed only after submission of return.

The above rule has been inserted through notification No.49/2019–Central Tax Dated: 9th October, 2019.  Department cannot apply this for earlier period.

As per circular No.123/42/2019-GST Dated 11th November, 2019 The restriction of rule 36(4) will be applicable only on the invoices /debit notes on which credit is availed after 09.10.2019.

The recipient can challenge reversal of ITC if he is in possession of proper tax invoices and has taken credit in his GSTR-3B within the time limit prescribed.