Manash Ghosh Vs Assistant Commissioner of Revenue (Calcutta High Court)
Summary: The Calcutta High Court allowed Manash Ghosh’s writ petition challenging an adjudication order dated 19 April 2024 passed under Section 73 of the CGST Act, 2017 for financial year 2018-19, which raised a demand of ₹1,18,35,089 by denying input tax credit on returns filed beyond the original statutory due date. The petitioner submitted that the GSTR-3B returns for April 2018 to March 2019 had been filed before 30 November 2021 and that the retrospective insertion of Section 16(5) of the CGST Act regularised input tax credit for financial years 2017-18 to 2020-21 where the relevant return under Section 39 was filed up to that date. The petitioner argued that the benefit of the curative amendment introduced through the Finance (No. 2) Act, 2024 could not be denied merely because the adjudication order had already been passed. Reliance was placed on Hiranmoy Dutta Vs State of West Bengal, reported in [2025] 172 taxmann.com 750 (Calcutta), in which a Coordinate Bench held that input tax credit disallowed for delayed GSTR-3B returns stood regularised by the new cut-off under Section 16(5).
The respondents opposed the petition, contending that the petitioner’s case did not squarely fall within the inserted provision and that Section 16(5) could not reopen a concluded assessment. On examining the record, the High Court held that the petitioner had made out a case warranting interference. It found the amendment curative and retrospective from 1 July 2017 and held that a taxpayer whose relevant returns were filed by 30 November 2021 could not be denied its benefit. The ratio of Hiranmoy Dutta was found squarely applicable. Consequently, the Court quashed the order dated 19 April 2024 and directed the Joint Commissioner to re-adjudicate the matter within six weeks in light of Section 16(5), after verifying the dates on which the GSTR-3B returns were filed. The authorities were restrained from taking coercive steps until re-adjudication. As no affidavit had been called for, the allegations in the writ petition were deemed not admitted by the respondents.
Cases Discussed
- Hiranmoy Dutta Vs State of West Bengal (Calcutta High Court); [2025] 172 taxmann.com 750 (Calcutta).
FULL TEXT OF THE JUDGMENT/ORDER OF CALCUTTA HIGH COURT
1. Affidavit of service filed in Court today is taken on record. Despite service, the State remains unrepresented in Court today.
2. The petitioner challenges inter alia, the legality and sustainability of the adjudication order dated 19th April, 2024 for the financial year 2018-2019 passed under Section 73 of the CGST Act, 2017 (hereinafter referred to as, “the said Act”).
3. The core issues involved in the instant writ petition is whether the order dated 19th April, 2024 passed under Section 73 of the said Act for the financial year 2018-2019 is liable to be quashed and set aside on the ground that the petitioner cannot be denied the benefit of the amendment introduced by way of insertion of subsection 5 of Section 16 of the said Act vide the Finance (No. 2) Act. 2024, which retrospectively regularized the Input Tax Credit for financial year 2017-2018 to 2020-2021 if returns are filed up to 30th November, 2021.
4. It is submitted the Section 16(5) of the said Act, subsequently inserted with effect from 1st July, 2017 by amending Section 16, provides:
“(5) Notwithstanding anything contained in sub-section (4), in respect of an invoice 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, the registered person shall be entitled to take input tax credit in any return under section 39 which is filed up to the thirtieth day of November, 2021.”
5. It is contended that the petitioner filed the GSTR-3B returns for April, 2018 to March, 2019 prior to 30.11.2021. By virtue of the inserted clause, as amended in Section 16, the petitioner cannot be denied the benefit of such amendment. Hence, the input tax credit denial is illegal.
6. The petitioner submits that for the year 2018-2019, respondent no.1 imposed a demand of Rs.1,18,35,089/- on the petitioner vide order in original dated 19.04.2024.
7. Notwithstanding the insertion of the clause introduced by the Finance (No. 2) Act. 2024, the respondent authorities have issued the impugned order dated 19.04.2024 for a demand of Rs.1,18,35,089/- for the period 2018-2019.
8. In the present case, the petitioner filed the return beyond due date but prior to 30th November, 2021.
9. In this context, the petitioner relies upon a judgment of a Co-ordinate Bench of this Court in the case of Hiranmoy Dutta vs. State of West Bengal reported in [2025] 172 taxmann.com 750 (Calcutta) at paragraph 6, which is reproduced below:
“6. 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 subsection (5) to Section 16, the returns filed by the petitioner which are in respect of the tax period from July, 2018 to March 2020 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.”
10. Learned counsel appearing for the respondent authorities vehemently opposes the same and submits that the case of the petitioner does not squarely fall within the inserted clause which has been introduced with effect from 1st July, 2017 and the order has already been passed by the authority concerned.
11. Section 16(5) cannot be invoked to reopen a concluded assessment. The benefit of the amendment is conditional upon the filing return by 30th November, 2011.
12. Having heard the parties and upon perusing the record, this Court finds that the petitioner has made out a prima faciecase and interference is warranted, at this stage.
13. This Court finds that by virtue of the inserted clause, as amended in Section 16, the petitioner cannot be denied the benefit of such amendment. The amendment is curative and retrospective from 01.07.2017.
14. The ratio in Hiranmoy Dutta (supra) is squarely applicable. Once returns are filed by 30.11.21, input tax credit for April, 2018 to March, 2019 is regularized.
15. In view of the above, the order dated 19th April, 2024 is hereby quashed and set aside and accordingly, the writ petition is allowed and disposed of.
16. The order in original dated 19.04.2024 shall be re-adjudicated by the Joint Commissioner in light of Section 16(5) of the said Act within 6 weeks after verifying the date of filing GSTR 3B. The respondent authorities are restrained from taking any coercive steps till the date of re-adjudication.
17. Since no affidavit has been called for, the allegations made in the writ petition are deemed not to have been admitted by the respondents.
