Calcutta HC Allows ITC Claim Under Amended GST Law

Sujit Kumar Ghosh Vs Assistant Commissioner of State Tax, Malda Charge & Ors. (Calcutta High Court)

Calcutta High Court, in Sujit Kumar Ghosh vs. Assistant Commissioner of State Tax, addressed the disallowance of Input Tax Credit (ITC) claimed by the petitioner under Section 16(4) of the West Bengal Goods and Services Tax (WSBGST) Act, 2017. The dispute revolved around the petitioner filing Form GSTR-3B beyond the due date for the April 2018 to March 2019 tax period. The department rejected the ITC claim through an order under Section 73 of the WSBGST/CGST Act, 2017. The petitioner argued that the West Bengal Goods and Services Tax (Amendment) Act, 2024, which was notified on January 10, 2025, extended the cut-off date for ITC claims, effectively regularizing his return.

The petitioner, represented by counsel, relied on Section 16(5) of the amended Act, which withdrew the penal consequences under Section 16(4) for ITC claims related to invoices or debit notes for FY 2017-18 to 2020-21. The petitioner emphasized that his GSTR-3B was filed within the newly extended deadline of November 30, 2021. To support this, the Central Board of Indirect Taxes and Customs (CBIC) issued a circular on October 8, 2024, allowing taxpayers to file rectification applications for availing the amendment’s benefits. The petitioner sought leave to apply for such rectification.

The State tax department conceded that rectification applications were the proper channel for relief but argued that they must be filed electronically through the prescribed process. The court acknowledged the department’s stance but emphasized that the amended law effectively validated the petitioner’s ITC claim. Since the returns for April 2018–March 2019 were now legally regularized, the court held that the petitioner could not be denied ITC under the amended provisions.

Relying on the amended statutory framework and CBIC’s circular, the Calcutta High Court directed the petitioner to file an appropriate rectification application before the relevant authority. The judgment reflects a pro-taxpayer approach in cases where statutory amendments provide retrospective relief. Similar judicial precedents include Aap & Co. LLP v. Union of India (2021), where the Gujarat High Court allowed ITC claims based on procedural relaxations, and Bharti Airtel Ltd. v. Union of India (2020), where the Supreme Court stressed substantive compliance over technicalities.

With these observations, the Calcutta High Court disposed of the writ petition (WPA 2075 of 2023), setting a precedent for taxpayers seeking ITC relief under GST amendments.

Petitioner was represented by Mr. Himangshu Kumar Ray,Ms. Shiwani Shaw,Mr. Subhasis Podder, Mr. Animitra Roy and Mr. Piyas Chowdhury.

FULL TEXT OF THE JUDGMENT/ORDER OF CALCUTTA HIGH COURT

1. Challenging the order passed under Section 73 of the WSBGST /CGST 2017 (hereinafter referred to as the “said Act”) for the tax period from April 2018 to March 2019, whereby the ITC claimed by the petitioner on the basis of the returns filed under Section 39 of the said Act in Form GSTR 3B beyond the due date, had been disallowed, the instant writ petition has been filed.

2. Mr. Ray, learned advocate appearing for the petitioner by drawing attention of this Court to the West Bengal Goods and Services Tax (Amendment) Act, 2024 which has been notified in the Kolkata Gazette on 10^th January 2025, would submit that sub-Section (5) to Section 16 of the said Act has been inserted with effect from 1^st July 2017, whereby the penal effect contained in sub-Section (4) of Section 16 of the said Act in respect of invoices or debit note for supply of goods or services or both pertaining to the financial years 2017-18, 2018-19, 2019-20 and 2020- 21 has been withdrawn, by extending the cut off date for filing of returns upto 30^th November 2021.

3. By drawing attention of this Court to the order dated 7^th December 2020, whereby the claim for ITC under Section 16(4) of the said Act has been disallowed, he submits that the returns filed in Form GSTR 3B was filed within the extended cut of date as provided for in Section 16(5) of the said Act. It is submitted that to give effect to the aforesaid provision, the Central Board of Indirect Taxes and Customs, GST Policy Wing by circular dated 8^th October 2024 has permitted the registered tax payers to file appropriate rectification application along with pro forma in Annexure – A to such circular, as such he seeks leave to apply for availing the benefit of the amended provision.

4. Siddiqui, learned Senior advocate and Additional Government Pleader acknowledges the above. He, however, submits that it is only on the basis of an appropriate application to be filed electronically that the petitioner’s case for rectification can be considered.

5. Having heard the learned advocates appearing for the respective parties and noting that in this case, the ITC had been disallowed by reasons of the petitioner filing the return in Form GSTR 3B beyond the due date, and on the basis of insertion of sub- section (5) to Section 16, the returns filed by the petitioner which is in respect of the tax period from April 2018 to March 2019 have now been regularized having regard to the new cut of date provided for in Section 16(5) of the said Act, I am of the view that the petitioner cannot be denied the benefit of the aforesaid amendment.

6. Having regard thereto, I permit the petitioner to apply before the appropriate authority by making appropriate rectification application.

7. With the aforesaid observations and directions, the writ petition being WPA 2075 of 2023 is accordingly disposed of.