Delhi GST Notif. 22/2024: 6 Month Window to Rectify ITC Denials under Sec 16(4)

Why This Notification Matters

Delhi’s GST Notification 22/2024, issued on 1st December 2025, opens a rare and time-bound opportunity for businesses and professionals who lost input tax credit (ITC) due to the infamous section 16(4) deadline. If your ITC was denied only because of a timing issue, but is now eligible under the new subsections 16(5) or 16(6), you can apply for rectification—even if the order is old. This is a compliance game-changer for CFOs, accountants, and business owners in Delhi, offering a second chance to reclaim blocked credits and clean up past GST disputes. For expert assistance in the region, consulting a Delhi chartered accountant is highly recommended.

What Changed, Who Benefits, and How This Window Works

Earlier, if you missed the strict time limit under section 16(4) to claim ITC, your credit was lost—even if you met all other conditions. Now, with the introduction of subsections 16(5) and 16(6), some of these previously denied credits have become eligible. Notification 22/2024 creates a 6-month window for Delhi-registered taxpayers to apply for rectification of past orders (under sections 73, 74, 107, or 108) where ITC was denied solely due to 16(4), provided no appeal is pending or filed. The application must be made online, with details in Annexure A, and the original authority must decide within 3 months.

The Backstory: ITC Denial under Section 16(4) and the New Hope

Section 16(4) of the Delhi GST Act set a hard deadline for availing ITC—typically the due date of the September return following the end of the financial year, or the date of annual return, whichever is earlier. Many taxpayers lost ITC simply because of delayed documentation or inadvertent errors, even when the underlying transaction was genuine. Appeals and revisions offered little relief, as the law was clear and strict.

Recent amendments introduced subsections 16(5) and 16(6), which relax the eligibility for certain cases—such as delayed invoices due to supplier errors or other specified circumstances. This shift prompted the need for a special rectification process, as many old orders had already confirmed ITC denial under the old regime. For related legal nuances, see the Allahabad HC: ITC Can’t Be Denied for Supplier’s Later Cancellation; Section 74 Set Aside blog post.

Who Can Apply? Eligibility Checklist in Plain English

Before you rush to file, check these four conditions. You are eligible only if all are true:

1. ITC was denied solely due to section 16(4)—not for any other reason (like ineligible goods/services, fake invoices, or mismatched returns).
2. The same ITC is now eligible under section 16(5) and/or 16(6)—meaning the law has changed in your favour for this specific credit.
3. The order against you was passed under section 73, 74, 107, or 108—these cover demand and recovery, as well as appeals and revisions.
4. No appeal has been filed or is pending for that order—if you have already appealed, you cannot use this rectification route.

Who is not eligible?

• If your ITC was denied for reasons other than 16(4) (e.g., fraud, ineligible input, or other compliance failures).
• If you have already filed an appeal or your appeal is pending for the same order.
• This notification is only applicable to suppliers registered in Delhi. Check your registration status or initiate one via our GST Registration Services India page.

Tip: If in doubt, review your order and consult your GST consultant before proceeding.

Special Rectification Procedure: Key Features

• 6-Month Application Window:
  The clock starts from 1st December 2025. You must file your rectification application on the GST portal by 31st May 2026. Missing this window means losing the benefit—no extensions.
• 3-Month Decision Timeline:
  The original authority (who passed the order) must process your application and issue a rectified order within 3 months of your application date.
• Scope Limitation:
  Only ITC denied under section 16(4) and now eligible under 16(5) or 16(6) can be rectified. No other issues or credits can be reopened.
• No Reopening of Other Matters:
  This process is strictly for the specified ITC. Other disputes or unrelated credits remain unaffected.

Step-by-Step Guide to Filing Your Rectification Application

1. Review Your Order and Check Eligibility

• Read the order carefully. Confirm that ITC was denied only due to 16(4).
• Ensure the same ITC is now eligible under 16(5) or 16(6).
• Confirm no appeal is filed or pending.

2. Gather Documentation

• Keep a copy of the original order.
• Prepare workings showing the ITC denied and now eligible.
• Collect supporting documents (invoices, correspondence, eligibility proofs).

3. Prepare Annexure A

• Download the proforma (Annexure A) from the notification or GST portal.
• Fill in all fields: GSTIN, legal/trade name, order details, year-wise ITC denied, and now eligible ITC (as per 16(5)/(6)).
• Double-check for accuracy—errors can lead to rejection.

4. File Online on GST Portal

• Log in to the GST portal.
• Navigate to the rectification application section (look for “Rectification under Notification 22/2024” or similar).
• Upload Annexure A and all supporting documents.
• Complete the declaration and verification truthfully.

5. Submit and Track

• Submit the application electronically.
• Save the acknowledgement for your records.
• Monitor the portal for updates or queries from the authority. For ongoing dispute support, consider professional help with GST Litigation Services.

Annexure A: Documentation and Accuracy Essentials

Getting Annexure A right is the heart of your rectification application. This proforma is not just a formality—it’s your evidence and declaration rolled into one. Here’s how to fill it out, field by field, and avoid the common pitfalls that trip up even seasoned professionals.

Field-by-Field Guide

1. Basic Details

• GSTIN: Enter your 15-digit GST registration number. Double-check for typos.
• Legal Name: As per GST registration certificate.
• Trade Name (if any): Only if you have a registered trade name.
• Order Details: Clearly mention the order number, reference, and date. These must match the order you’re seeking to rectify.
• Order Reference Number & Date: Copy exactly as per the order—mismatches can cause delays.

   2. Details of Demand Confirmed

• Fill the year-wise table for each financial year where ITC was denied. Enter IGST, CGST, SGST, CESS, total tax, interest, and penalty as per the order.
• Tip: Use the exact figures from the order—do not round off or estimate.

  3. Segregation of Eligible ITC

• Table (a): Enter the portion of ITC denied under 16(4) that is now eligible under 16(5).
• Table (b): Enter the portion now eligible under 16(6).
• If both apply, fill both tables. If only one applies, leave the other blank.
• Supporting Evidence: Attach workings, invoices, or correspondence that prove eligibility under 16(5) or 16(6).

  4. Declaration

• You must confirm that no appeal is filed or pending for the same order. Any misstatement here can void your application and trigger penalties.
• Declare that all information is true and complete.

  5. Verification

• The authorised signatory must sign, stating their name, designation, email, and mobile number.
• This is a legal declaration—false information can lead to recovery and prosecution.

Common Mistakes to Avoid

• Incomplete Fields: Leaving any field blank or entering “NA” without reason can lead to rejection.
• Data Mismatch: Figures in Annexure A must match the order and your books. Any mismatch is a red flag.
• Misreporting Eligible ITC: Only include ITC denied under 16(4) and now eligible under 16(5)/(6). Do not club other credits.
• Omitting Appeal Status: Failing to declare a pending appeal (or misrepresenting) is a serious compliance breach.
• Missing Documents: Not attaching the order copy, ITC workings, or eligibility proofs can stall your application.

Supporting Documents to Attach

• Copy of the original order (under 73/74/107/108)
• Detailed ITC workings (showing denied and now eligible credits)
• Invoices, supplier correspondence, or other evidence supporting eligibility under 16(5)/(6)
• Any clarificatory letters or prior communications with the department

Segregating and Reporting Eligible ITC: Analytical Approach

Identifying the correct portion of ITC is crucial. Here’s how to do it methodically:

1. Identify ITC Denied Solely under 16(4)

• Review the order and note the specific credits denied only due to the timing bar of 16(4).
• Exclude any ITC denied for other reasons (e.g., ineligible goods, fake invoices).

     2. Map to Eligibility under 16(5) or 16(6)

• Cross-check the denied ITC against the new provisions. For example, if the delay was due to supplier error now covered under 16(5), include it.
• Prepare a reconciliation statement showing how each denied credit is now eligible.

    3. Reconcile with Books and Returns

• Ensure the amounts you report match your GST returns and accounting records.
• Any discrepancies should be explained and documented.

   4. Documentation Pointers

• Keep a clear audit trail—notes, emails, and calculations supporting your claim.
• If in doubt, prepare a summary sheet mapping each denied ITC to the relevant new provision.

For detailed guidance on ITC and audits, you may also refer to our GST Audit Services.

Resulting Actions & Outcome Tracking

Once you’ve submitted your application:

• Acknowledgement: The portal will generate an acknowledgement. Save this for your records.
• Authority Review: The original order-passing authority will review your application and documents.
• Timeline: The authority should issue a rectified order within 3 months of your application.
• Order Upload:

1. If the original order was under section 73/74, the rectified summary will be uploaded in FORM GST DRC-08.
2. If under section 107/108, it will be in FORM GST APL-04.

• Tracking:

1. Log in to the GST portal and check the “Orders/Rectification” section for updates.
2. Respond promptly to any queries or requests for additional information.

Risks, Natural Justice, and Redressal Safeguards

• Adverse Rectification: If the authority proposes to reject or partially allow your application, you must be given a notice and a chance to reply or be heard.
• Natural Justice: You have the right to present your case, submit further evidence, and request a personal hearing if the outcome is not in your favour. See the blog on HC: Right to Be Heard in Rectification u/s 161 GST if Order Adversely Affects Party – Key Takeaways for details.
• Recourse: If dissatisfied with the rectified order, you may explore further remedies as per GST law (e.g., appeal, review).

Key Dates, Deadlines, and Action Calendar

• Application Window:
  Opens: 1st December 2025
  Closes: 31st May 2026
  Example: If you file on 15th February 2026, your rectification order should be issued by 15th May 2026.
• Decision Timeline:
  3 months from your application date.
• Best Practice:
  Apply well before the deadline to allow time for corrections or clarifications if needed.

Concise FAQs – Error-Prevention Quick Reference

Q1. Am I eligible if an appeal is filed or pending?
No. If you have filed or have a pending appeal for the same order, you cannot use this rectification window.

Q2. What if I can’t segregate the eligible ITC?
You must clearly identify and evidence the ITC denied solely under 16(4) and now eligible under 16(5)/(6). If you can’t, your application may be rejected.

Q3. How do I determine my 6-month window?
Count 6 months from 1st December 2025. The last date is 31st May 2026.

Q4. What if the authority doesn’t decide in 3 months?
Follow up via the portal and, if needed, escalate through professional channels. There is no automatic approval if the authority delays.

Q5. Can I reapply if my application is rejected?
No. The notification does not provide for a second application for the same order.

Q6. What are the penalties for incorrect info or missed steps?
False declarations or missing documents can lead to rejection, recovery of ITC, interest, and penalties.

Final Word: Act Now, Act Diligently

This rectification window is a rare chance to reclaim ITC lost to technicalities. Don’t let paperwork or missed deadlines stand in your way. Review your orders, consult your GST advisor in Delhi, and file a complete, accurate application well before the cut-off. Proper compliance now can save you years of litigation and unlock much-needed working capital.

If you’re unsure at any step, seek professional help. The long-term benefit is not just the ITC—it’s peace of mind and a cleaner compliance record.

Additional Local Expertise

For businesses operating beyond Delhi, our offices like chartered accountants in Chandigarh and chartered accountants in Ghaziabad offer similar GST expertise to assist you with compliance and rectification processes.