The GST Department has issued an advisory on 12-Nov-24 with respect to the Invoice Management System (IMS). To reiterate, IMS is an optional feature introduced on the GST Portal starting October 2024. It allows recipients to accept, reject, or keep pending invoices/records that are saved or submitted by suppliers in GSTR-1, GSTR-1A, or IFF. Based on the recipient’s actions in the IMS, the system will generate the recipient’s GSTR-2B on the 14th of the following month.

Taxpayers can review and take action (accept, reject, or keep pending) on invoices/records in the IMS after verifying them against their accounts. If a record is rejected, the recipient will not be able to claim Input Tax Credit (ITC) for that record in their GSTR-2B. Additionally, the liability and ITC are automatically populated in the taxpayer’s GSTR-3B on the portal based on the details declared in GSTR-1/1A and the ITC available in GSTR-2B. However, taxpayers can edit the auto-populated data in GSTR-3B before filing it.

As IMS is a new feature, there may be instances during its initial rollout where recipients make errors when taking action on an invoice (such as accepting, rejecting, or keeping it pending). Since the GSTR-2B is generated based on these actions, mistakes could lead to incorrect ITC being shown in the recipient’s GSTR-2B, which will also be auto-populated into GSTR-3B. In such cases, the recipient can correct the action taken on the IMS (e.g., changing a record from rejected to accepted or vice versa) and recompute their GSTR-2B until the filing of GSTR-3B for the relevant tax period, ensuring the correct ITC is auto-populated.

However, there may still be situations where the recipient cannot correct the action taken on the IMS, resulting in incorrect ITC or tax liability being auto-populated in their GSTR-3B or the supplier’s GSTR-3B. Therefore, during the initial phase of IMS implementation, taxpayers are advised to review their GSTR-3B carefully. If any errors are found in the auto-populated ITC or liability due to an inadvertent mistake in IMS actions, taxpayers should correct these details before filing their GSTR-3B, ensuring the accurate ITC is claimed and the correct tax liability is paid, based on the available supporting documents/records.