Case Law Details
Philips Auto Agencies (India) Pvt. Ltd. Vs State Tax Officer (Kerala High Court)
Introduction: Philips Auto Agencies (India) Pvt. Ltd. approached the Kerala High Court after being denied Input Tax Credit (ITC) under the Goods and Services Tax (GST) Act for the fiscal year 2018-19. The denial was attributed to a discrepancy between GSTR-2A and GSTR-3B.
Detailed Analysis
1. Grounds of Denial: The petitioner contended that the denial of ITC stemmed from a mismatch between GSTR-2A and GSTR-3B. Notably, GSTR-2A was introduced in September 2018, rendering the denial unjustifiable.
2. Legal Provisions: The petitioner invoked Section 73(3) of the GST Act, which mandates providing a statement of mismatch to the assessee. However, such a statement was not furnished in this case, depriving the petitioner of the opportunity to substantiate their ITC claim.
3. Judicial Intervention: After hearing arguments from both parties, the court opined that the petitioner’s claim merits reconsideration by the Assessing Authority. The court directed the first respondent to reevaluate the claim, considering the Circular dated 27.12.2022 and affording the petitioner an opportunity for a fair hearing.
4. Remittance for Fresh Consideration: The court disposed of the writ petition, setting aside the assessment order and remitting the matter to the Assessing Authority. The petitioner was instructed to appear before the authority for reconsideration on a specified date.
Conclusion: The Kerala High Court’s decision in the case of Philips Auto Agencies underscores the significance of procedural fairness and adherence to legal provisions in GST assessments. Denying ITC solely based on a mismatch between GSTR-2A and GSTR-3B without providing a statement of discrepancy violates the principles of natural justice. The court’s intervention ensures that the petitioner’s claim is reconsidered in accordance with the law and relevant circulars, emphasizing the importance of due process in tax matters.
FULL TEXT OF THE JUDGMENT/ORDER OF KERALA HIGH COURT
The petitioner has approached this Court being aggrieved by the fact that he has been denied Input Tax Credit in the assessment of the Goods and Services Tax Act for the year 2018-19.
2. The learned counsel appearing for the petitioner would submit that, the denial of Input Tax Credit was on account of mismatch between GSTR-2A and GSTR-3B. It is submitted that GSTR-2A was introduced only in the month of September 2018 and therefore, the Input Tax Credit could not have been denied on account of such mismatch. It is also pointed out that, in terms of Section 73(3) of the Goods and Services Tax Act, 2017, the statement of mismatch should have been provided to the assessee and this has not been done. It is submitted that, if such a statement had been provided, the petitioner would have been able to substantiate its claim for Input Tax Credit in terms of Circular No183/15/2022-GST dated 27.12.2022.
3. Heard the learned Government Pleader also.
4. Having heard the learned counsel for the petitioner and the learned Government Pleader and having regard to the facts and circumstances of the case, I am of the view that the claim of the petitioner can be directed to be reconsidered by the Assessing Authority also having regard to the provisions of the Circular dated 27.12.2022 referred to above. If the petitioner requests for a statement in terms of the provisions contained in Section 73(3) of the Goods and Services Tax Act, the same should also be provided to him.
Therefore, this writ petition is disposed of setting aside Ext.P4 order of assessment of the petitioner for the year 2018-19 and remitting the matter for a fresh consideration of the first respondent. The first respondent shall consider the claim of the petitioner as directed above also keeping in mind in terms of the Circular dated 27.12.2022 and after affording an opportunity of hearing to the petitioner. The petitioner shall appear before the first respondent at 11.00 a.m. on 20.03.2024 and thereafter, the matter shall be reconsidered as directed above. I make it clear that I have not expressed any opinion on the merits of the matter.
Author Bio
