Jagdamba Enterprises Vs Union of India (Patna High Court)
Summary: The Patna High Court considered a writ petition filed by M/s Jagdamba Enterprises challenging an order dated 14.12.2023 passed under Section 73 of the GST Act and the corresponding DRC-07 summary for the period 2017-18, under which tax, interest and penalty aggregating to Rs. 22,62,318/- had been imposed. The petitioner relied upon Annexure-P/2 containing auto-populated tax liability and ITC data and submitted that the ITC available as per GSTR-2A was Rs. 76,16,209.08/-, whereas the ITC actually claimed through GSTR-3B was Rs. 60,53,895.38/-.
Thus, according to the petitioner, the credit claimed was lower than the credit appearing in the auto-populated GSTR-2A data. The petitioner further pointed out that the GSTR-9 reflected ITC as per GSTR-2A at Rs. 25,40,879.28/- towards CGST and an equivalent amount towards State GST, aggregating to Rs. 50,81,750.56/-, which was stated to be inconsistent with the auto-populated data contained in Annexure-P/2. The petitioner contended that the incorrect figure appearing in GSTR-9 resulted from a technical error which could not be rectified at the petitioner’s end. Reliance was placed upon the Supreme Court decision in Central Board of Indirect Taxes and Customs Vs. M/s Aberdare Technologies Private Limited & Ors. and the Division Bench decision of the Patna High Court in Om Traders Vs. Union of India. The State, however, submitted that the ITC figure in GSTR-3B was a net figure after reversal of ITC, including reversal on account of reverse charge, and therefore could be lower than the amount reflected in GSTR-2A.
Upon considering the rival submissions and documents, the Court formed a prima-facie opinion that there were apparent contradictions between the auto-populated ITC summary in Annexure-P/2 and the ITC claimed by the petitioner in GSTR-9. The Court further recorded the petitioner’s contention that the discrepancy had arisen because of a technical glitch and that the clerical or arithmetical error could not be rectified by the petitioner and had to be rectified at the revenue’s end. In these circumstances, the Court held that the interest of justice would be served by remanding the matter to the Adjudicating Authority. The assessment order was accordingly set aside and the matter was remanded for passing a fresh order after giving the petitioner an opportunity of hearing and taking into consideration the specific contention raised by the petitioner, in accordance with law, within two months.
Cases Discussed
- Central Board of Indirect Taxes and Customs Vs. M/s Aberdare Technologies Private Limited & Ors. (Supreme Court)
- Om Traders Vs. Union of India (Patna High Court)
FULL TEXT OF THE JUDGMENT/ORDER OF PATNA HIGH COURT
Heard learned counsel for the petitioner and learned counsel for the State.
2. The present application has been filed against the order dated 14.12.2023, passed under Section 73 of the GST Act and the summary order in DRC-07 for the period of 2017-18 by the Adjudicating Authority has imposed tax, interest and penalty of Rs. 22,62,318/.
3. Learned Senior counsel for the petitioner argued that as per Annexure-P/2, which is auto-populated data of tax liability and ITC summary, pointing out the auto-populated figure under ITC i.e., GSTR-2A, learned counsel submits that total ITC amount available as per the data to the petitioner is Rs. 76,16,209.08/ and as per GSTR-3B, i.e., a credit taken against ITC the figure shown is 60,53,895.38/.
4. It has thus been submitted that the petitioner has only claimed the credit of Rs. 60,53,895/ towards ITC against the total ITC claim available to the petitioner as per GSTR-2A of Rs. 76,16,209.08/.
5. Accordingly, the petitioner has claimed less amount of about Rs. 16 lakh and odd towards his ITC claim. It has further been argued by learned Senior counsel that upon perusal of GSTR-9 i.e., annual tax return at page- 39, it would be evident that ITC as per GSTR-2A, has been to the extent of Rs. 25,40,879.28/ CGST and Rs. 25,40,879.28/ State GST, which comes to a total of around Rs. 50,81,750.56/. This figure according to learned counsel is auto-populated and is in contradiction to the auto-populated data of GSTR-2A as available in Annexure-P/2. The Adjudicating Authority on the basis of figure mentioned in GSTR-9, has arrived at the conclusion of imposition of tax, penalty etc. upon the petitioner which has been assailed in the present writ application.
6. It has further been submitted by the petitioner that the auto-populated wrong figure has appeared in GSTR-9 which is due to the technical error and cannot be corrected at the end of the petitioner. The Hon’ble Supreme Court in Central Board of Indirect Taxes and Customs Vs. M/s Aberdare Technologies Private Limited & Ors. in SLP(C) Diary No. 6332/2025 (Annexure-P/6), has taken note of this fact of human error or technical error and also Division Bench of this Court in Om Traders Vs. Union of India in CWJC no. 16509 of 2024.
7. On the other hand, Mr. Vivek Prasad, GP-7, learned counsel for the State argued that as per tax liability and ITC summary (Annexure-P/2), a note has been appended showing that ITC claim in GSTR-3B is a net of reversal of ITC and includes reversal made on account of reverse charge. Therefore, ITC reflected in GSTR-3B might be less than i.e., auto-populated in GSTR-2A.
8. After having heard learned counsel for the parties and upon perusal of the documents placed by learned Senior counsel for the petitioner and learned counsel for the respondent, we are of the Prima-facie opinion that there appears to be apparent contradictions in the auto-populated data of ITC summary as Annexure-P/2 and the ITC claimed by the petitioner in GSTR-9.
9. The contention of the petitioner that this discrepancy has occurred due to technical glitch and the same is not on the part of the petitioner. The clerical or arithmetical error has occurred due to technical glitch and the petitioner is not in a position to rectify the same and it has to be rectified at the end of the revenue.
10. Considering the above, we are of the opinion that the interest of justice shall sub-serve if the matter is remanded back to the Adjudicating Authority to pass a fresh assessment order after giving opportunity of hearing to the petitioner in accordance with law. In the result, the order of assessment is set aside and the matter is remanded back to the Adjudicating Authority to pass a fresh order taking into consideration the specific contention raised by the petitioner in accordance with law within a period of 2 months.
