Bright Hardware Vs Deputy State Tax (Madras High Court)
In a significant judgment, the Madras High Court addressed the issue of inadvertent errors in GSTR 3B filings and their consequences. The case of Bright Hardware Vs Deputy State Tax highlighted the procedural lapses and the court’s emphasis on principles of natural justice.
Bright Hardware challenged an order dated 18.01.2024, which imposed a substantial tax demand. The petitioner argued that the tax demand was a result of an inadvertent error in the GSTR 3B return for September 2018. Specifically, an entry was mistakenly made in column 4(A)(3) (inward supply liable to reverse charge) instead of column 4(A)(5) (all other ITC).
The petitioner, represented by their counsel, claimed that the error was not intentional and was due to the oversight of a part-time accountant handling GST compliances. The counsel requested another opportunity to rectify the mistake and proposed remitting 10% of the disputed tax demand as a condition for reconsideration.
The Additional Government Pleader, Mr. T. N. C. Kaushik, argued that all principles of natural justice were followed. Notices and show cause notices were duly issued, and a personal hearing was offered. The respondent maintained that the tax liability was correctly imposed based on the filed returns.
