This circular provides clarification on the correct reporting of inter-State supplies made to unregistered persons, composition taxable persons and UIN holders in FORM GSTR-3B and FORM GSTR-1.

The circular explains that registered suppliers are required to report details of inter-State supplies made to unregistered persons in Table 3.2 of FORM GSTR-3B. In addition, inter-State supplies to unregistered persons where the invoice value is up to ₹2.5 lakh are also required to be reported, rate-wise, in Table 7B of FORM GSTR-1.

It was observed that in many cases taxpayers were reporting such details only in Table 7B of FORM GSTR-1 and not in Table 3.2 of FORM GSTR-3B. The circular clarifies that reporting in GSTR-3B is critical, as apportionment of IGST to the consuming State is based on the information furnished in Table 3.2 of GSTR-3B. Non-reporting leads to incorrect apportionment of IGST and non-compliance with the IGST Act.

Accordingly, taxpayers making inter-State supplies to unregistered persons are instructed to correctly report such supplies, along with place of supply, in both the prescribed tables of GSTR-3B and GSTR-1. Failure to comply with these requirements may attract penal action under the CGST Act.

These instructions aim to ensure accurate tax apportionment and uniform compliance.