Case Laws| GST: Where assessee was unable to claim ITC due to non-availability of Form GSTR-2 and non-filing of GSTR-3B in online, impugned order disallowing ITC deserved to be set aside
[2024] 158 taxmann.com 204 (Madras)
HIGH COURT OF MADRAS
Tvl.Kavin HP Gas Gramin Vitrak
v.
Commissioner of Commercial Taxes
MRS. S. SRIMATHY, J.
W.P.(MD). NOS. 7173 AND 7174 OF 2023
W.M.P.(MD) NOS. 6764 AND 6765 OF 2023
NOVEMBER 24, 2023
Input Tax Credit – Belated claim – Returns – Petitioner-assessee was engaged in business of Petroleum Gases and other Gaseous Hydrocarbons – Based on scrutiny of GSTR-3B returns filed for financial years 2017-2018 and 2018-19, respondent issued notice dated 27-4-2022 and directed petitioner to show cause why there was a belated claim of Input Tax Credit (ITC) and also directed to remit back same as wrong claim of ITC and proposed to reverse same – Petitioner submitted that due to financial crisis, petitioner had submitted GSTR-3B physically and same was already explained to respondents in person through his Accountant and hence allegation by respondents that said claim was false could not be accepted – However, to shock of petitioner, impugned order was passed and confirmed proposal with regard to alleged belated claim of ITC – Whether ITC shall be claimed through GSTR-2, GSTN had not provided facility of GSTR-2 till now
HELD: When Rules specifically prescribes GSTR-2 to specify inward supplies for claiming ITC, when said form was not notified, petitioner could not be expected to file same to claim ITC – Respondents without giving any opportunity to file returns by not notifying Form GSTR-2, could not expect taxable person to file returns – In absence of any enabling mechanism, assessee could not be prejudiced by not granting ITC – Impugned orders were to be quashed and respondents were to be directed to permit petitioner to file manual returns whenever petitioner was claiming ITC on outward supply/sales without paying taxes and to accept belated returns and if returns were otherwise in order and accordance to law, claim of ITC was to be allowed [Section 16 of Central Goods and Services Tax Act, 2017/Tamil Nadu Goods and Services Tax Act, 2017 – Rule 60 of Central Goods and Services Tax Rules, 2017/Tamil Nadu Goods and Services Tax Rules, 2017] [Paras 7 to 12] [In favour of assessee]
The court acknowledges the technical impediment faced by the petitioner in claiming ITC due to the unavailability of Form GSTR-2. Relying on precedents that recognize the absence of enabling mechanisms, the court quashes the impugned orders. It directs the authorities to allow manual returns for claiming ITC and reconsider the matter, emphasizing the practical difficulties faced by the petitioner. This case underscores the importance of addressing technical glitches and ensuring a fair and accessible framework for taxpayers in the GST system. The judgment aligns with previous decisions recognizing the need for an enabling mechanism and highlights the responsibility of authorities to rectify procedural shortcomings.
The judgment upholds the interest of the assessee when they are not in the wrong and has paid all their dues promptly. It highlights the importance of thorough preparation and effective presentation of evidence in legal proceedings, ultimately resulting in a favourable outcome for the taxpayer. This decision reaffirms the principle of fairness in the legal system and serves as a reminder of the significance of upholding the rights of individuals or entities being assessed. – JSPCO
