GSTR-9 Annual Return: Unresolved Crisis of GST Reconciliation & ITC Matching

GSTR-9 Annual Return: When Compliance Becomes a Trap — The Unresolved Crisis of GST Reconciliation and ITC Matching – An analysis for business entrepreneurs, taxpayers, and tax professionals — written for publication

Overview

Since the Goods and Services Tax (GST) was implemented in India on 1 July 2017, it has been hailed as the most transformative tax reform in the country’s independent history. The promise was simple and powerful — one nation, one tax, seamless credit flow, and an end to the cascading effect of multiple taxes. Nine years later, however, the ground reality for honest, hard-working traders, small business owners, and their tax professionals is far removed from that promise.

The annual return in Form GSTR-9 and the reconciliation statement in Form GSTR-9C were designed to be the final audit gateway — the year-end check where every transaction, every rupee of tax paid and every rupee of Input Tax Credit (ITC) claimed would be reconciled with audited books of accounts. Instead, these forms have become a source of confusion, unjust demand notices, and immense professional burden — not because businesses are dishonest, but because the system itself is structurally flawed.

This article explains, in plain language, exactly what is going wrong, why it is wrong, what the courts have said, and what the government and the GST Council must do to fix it.

What Is the Purpose of GSTR-9 and GSTR-9C — And Who Must File?

Before we understand what is going wrong, it is important to know what GSTR-9 is supposed to do.

Form GSTR-9 is the Annual Return under Section 44 of the CGST Act, 2017. It is a comprehensive statement that consolidates all the monthly or quarterly GST returns filed during a financial year — namely GSTR-1 (outward supplies) and GSTR-3B (summary return with tax payment) — into one annual document. Every regular GST-registered taxpayer with an annual aggregate turnover exceeding ₹2 crore is mandatorily required to file this return. For that below ₹2 crore, the government has been issuing notifications making the filing optional — but this distinction has a critical problem, which we will address shortly.

Form GSTR-9C is a Reconciliation Statement, which compares the figures in GSTR-9 with the audited financial statements — the Profit and Loss Account and Balance Sheet — of the business. As of 2026, GSTR-9C is mandatory for taxpayers with a turnover exceeding ₹5 crore. Crucially, this form is self-certified by the taxpayer in most cases, though Chartered Accountant certification was mandatory in earlier years.

The stated purpose of GSTR-9 is noble:

To ensure that all outward supplies are correctly reported

To confirm that ITC has been properly availed and reversed

To identify differences between returns filed and audited accounts

To allow correction of genuine errors and payment of any shortfall through Form DRC-03 before the annual filing deadline.

The problem is not the purpose. The problem is how the department is using GSTR-9 — selectively, mechanically, and without understanding its own design.

The Core Problem: The Department Is Matching Table 4 with Table 9 and Calling It “Reconciliation”

Here is the heart of the matter, and every business owner needs to understand this.

Table 4 of GSTR-9 contains details of outward supplies (sales) made during the financial year. This data is auto-populated from your GSTR-1 filings — that is, from the sales invoices you uploaded month by month throughout the year. Importantly, Table 4 is editable — a taxpayer can and should correct the figures if the reconciled accounts show a different number.

Table 9 of GSTR-9 contains the details of taxes paid, and it is auto-populated directly from GSTR-3B — the monthly summary return in which you declared and paid your tax. Table 9 is non-editable. You cannot change it. It pulls the exact figures from what you paid in GSTR-3B each month.

Now, a responsible taxpayer does this: At the time of filing the annual return, the accountant or CA reconciles the books for the full year. During this reconciliation, if any outward supply was missed in GSTR-1 but tax was already paid in GSTR-3B, or if an error was made earlier in the year, the taxpayer edits Table 4 to reflect the correct, reconciled figure. Any additional tax liability arising from this reconciliation is paid voluntarily through Form DRC-03 (a challan for voluntary tax payment) before or at the time of filing GSTR-9.

This is precisely what the law intends. This is precisely what the form allows. The department, however, is doing something entirely different.

The department is simply matching the auto-populated (and editable) Table 4 against the auto-populated (and non-editable) Table 9 — and where there is a difference, it is issuing mismatch notices and raising demands with interest and penalty.

This approach is wrong for one fundamental reason: Table 9 reflects what you paid in GSTR-3B. Table 4, when edited by the taxpayer, reflects what actually happened as per books of account. A difference between the two may simply mean the taxpayer corrected an honest error and already paid the differential through DRC-03. The department’s mechanical matching completely ignores:

The DRC-03 payment made at the time of filing

The audited accounts behind Table 4

The reconciliation statement in GSTR-9C that explains the differences.

The entire purpose for which GSTR-9 was designed

This is not reconciliation. This is simply comparing two columns of the same portal and treating any mismatch as evasion. It is unjust, and several courts have said so.

The ITC Disaster: Table 6, Table 8, and the GSTR-2B Matching Trap

If the outward supply issue is problematic, the ITC (Input Tax Credit) side of GSTR-9 is a complete disaster for taxpayers. Let us understand it step by step.

How ITC Is Supposed to Work

Under Section 16 of the CGST Act, a taxpayer is entitled to ITC if:

They possess a valid tax invoice

They have received the goods or services

The supplier has actually paid the tax to the government

They have filed their own return under Section 39.

Notice what Section 16 does NOT say — it does not say that ITC is valid only if the supplier uploaded the invoice in GSTR-1 and it appears in your GSTR-2B. The law’s eligibility conditions are substantive — actual receipt, actual payment, valid invoice. The portal’s auto-population is a facilitation mechanism, not a legal gateway.

The GSTR-2B Problem

Form GSTR-2B is a static, auto-drafted ITC statement generated every month based on what your suppliers uploaded in their GSTR-1 during that month. If your supplier forgot to upload an invoice, uploaded it with a wrong GSTIN, uploaded it in B2C instead of B2B, or filed the return after the due date — that invoice will not appear in your GSTR-2B.

The department has taken the position that ITC is available only to the extent it is reflected in GSTR-2B. This means a bona fide buyer who has a valid invoice, has received the goods, has paid the full price including GST, and has filed his own returns — can still be denied ITC simply because his supplier was non-compliant with portal uploads. The buyer has zero control over this. The buyer has done nothing wrong.

This is like telling a customer who has lawfully purchased goods and paid all taxes: “Your receipt is valid, your payment is confirmed, but since the shopkeeper did not update his register properly, your receipt is invalid.” It is fundamentally unjust.

What Happens in GSTR-9 as a Result

In Table 8 of GSTR-9, the department compares:

Table 8A: ITC as per GSTR-2B (auto-populated, non-editable)

Table 8B: ITC claimed in GSTR-3B (also auto-populated)

Table 8D: The difference between 8A and 8B — and this difference is sought to be lapsed (i.e., the taxpayer loses the credit permanently)

So, if you claimed ₹10 lakh ITC in your books and in GSTR-3B based on valid invoices, but GSTR-2B only shows ₹8 lakh because two suppliers uploaded their returns late — the department treats ₹2 lakh as ineligible and demands it back with interest and penalty. The department does not ask whether the supply was genuine. It does not ask whether you have a valid invoice. It looks only at the portal figure.

The Timing Problem with Section 16(4)

Under Section 16(4) of the CGST Act, a taxpayer can claim ITC for a financial year up to the due date of filing the September return of the following year (or the date of filing the annual return, whichever is earlier). Suppliers have a corresponding window to upload invoices. If a supplier uploaded the invoice within this window, the taxpayer becomes eligible for ITC — but GSTR-2B for past months does not get updated retroactively. The invoice appears in a later month’s GSTR-2B instead.

The law permits the ITC. The portal denies it mechanically. The taxpayer is caught in the middle.

Table 6 and the Reporting Maze

Table 6 of GSTR-9 is where the taxpayer reports ITC availed during the year. It is editable. A taxpayer who reconciled accounts and found that a supplier uploaded invoices late (but within the Section 16(4) window) can report this ITC in Table 6. However, the department insists on matching Table 6 with Table 8A (GSTR-2B figures) and disallowing anything that does not match the portal’s auto-population.

The situation for FY 2024-25 has become even more complex. Major changes were introduced in Tables 6, 7, and 8 of GSTR-9 for that year, including a new Table 6A (1) for prior-year ITC. Tax professionals have noted that even after all these adjustments, mismatches inevitably shift to Table 7J and Table 12 of GSTR-9C — the problem does not disappear, it simply moves from one table to another.

The Great Injustice: Notices to Taxpayers Below ₹2 Crore Who Are Not Even Required to File GSTR-9

Here is perhaps the most unjust aspect of the current enforcement approach.

The government has consistently kept GSTR-9 filing optional for taxpayers with turnover below ₹2 crore. The policy rationale is sound — small taxpayers should not be burdened with complex annual return filings. But what is happening on the ground?

The department is issuing mismatch notices based on the very same Table 4 vs. Table 9 comparison to taxpayers who are not even required to file GSTR-9. For these taxpayers, there is no annual return with reconciliation, no explanation of differences, no DRC-03 payment trail — and yet, the department is raising demands based on a mechanical comparison of GSTR-1 data and GSTR-3B data.

This is the height of inconsistency. The government says: “You don’t need to file an annual return.” And then the same government says: “But we’re comparing your GSTR-1 outward supply data with your GSTR-3B payment data and demanding tax on the difference.” If the government is going to use this comparison against these taxpayers, then it must either:

Make GSTR-9 mandatory and consider its reconciliation in every scrutiny proceeding, or

Stop raising mismatch demands based on a comparison that ignores the reality of books of account

You cannot have it both ways.

Why This Never Happened Under VAT: A Honest Comparison

Many experienced tax practitioners and business owners who went through the old VAT (Value Added Tax) regime will tell you — for all its faults, VAT did not create this kind of structural injustice around ITC.

Under VAT, ITC was available based on a valid purchase invoice in the books of account. The accounts were audited by a Chartered Accountant, the purchase register was verified, and the credit was allowed on the basis of substantive evidence. The tax auditor (CA) signed off on the accounts, took responsibility for the reconciliation, and the department accepted the certified accounts as the basis of assessment.

Under GST, the law says one thing (Section 16 — valid invoice, received goods, tax paid by supplier), but the portal enforces another (GSTR-2B matching). The accounts are audited by a CA in GSTR-9C, the reconciliation differences are explained and certified — and the department ignores all of it, going back to the portal’s auto-populated figures.

The result? Under VAT, a business audit typically involved checking purchase and sales registers against the CA’s certified accounts. Under GST, a business audit involves reconciling GSTR-1, GSTR-3B, GSTR-2A, GSTR-2B, GSTR-9, books of accounts, e-way bills, and e-invoices — six separate data sources that frequently contradict each other. The compliance cost and professional time involved has multiplied several times over, while the protection offered to honest taxpayers has actually decreased.

What the Courts Have Said: Relief Is Coming, But Slowly

The judiciary has begun to recognise these structural problems, and several important judgments provide significant relief to taxpayers. Every business owner and tax professional should be aware of these decisions.

1. Calcutta High Court — Pioneer Cooperative Car Parking Case (2025)

In the landmark case of Pioneer Cooperative Car Parking Servicing and Construction Society Ltd. v. State of West Bengal [MAT/1983/2023], the Calcutta High Court held that GSTR-9 cannot be ignored by the adjudicating authority.

The court stated clearly: “The purpose of filing an annual return under Section 44(1) of the Act read with Rule 80 would be rendered redundant if the annual return is not taken into account.

In that case, the taxpayer had not claimed ITC in GSTR-3B but had disclosed it in GSTR-9 with a reconciliation statement. The assessing officer refused to consider GSTR-9 and rejected the ITC claim. The High Court set aside this approach, holding that the GSTR-9 filed within the prescribed timeline must be given due consideration as it provides a more accurate and comprehensive picture of the taxpayer’s financial position.

This ruling was subsequently followed in other cases, including Laxmi Ghosh v. State of West Bengal [W.P.A. No 20364 of 2025], where the Calcutta High Court quashed an appellate order that had overlooked ITC disclosed in GSTR-9 but not claimed in GSTR-3B, directing fresh adjudication.

What this means for taxpayers: If your GSTR-9 was filed on time and contains the correct reconciled figures, the department cannot ignore it. If a demand notice ignores your GSTR-9 and relies only on GSTR-3B vs. GSTR-2A/2B mismatch, you have strong legal grounds to challenge it.

2. Gauhati High Court — McLeod Russel India Ltd. (December 2025)

In McLeod Russel India Limited v. Union of India & Others (Gauhati High Court, 9 December 2025), a Division Bench comprising Chief Justice Ashutosh Kumar and Justice Arun Dev Choudhury read down Section 16(2) (aa) of the CGST Act.

Section 16(2) (aa), inserted by the Finance Act 2021, made ITC contingent on the supplier uploading invoice details in GSTR-1 and the same appearing in the buyer’s GSTR-2B. The court held that ITC cannot be mechanically denied solely on the ground of supplier’s GSTR-1 default when the buyer is a bona fide purchaser who holds a valid invoice, has received goods/services, and has paid the consideration including tax.

The court directed that before denying ITC, authorities must grant the recipient an opportunity to establish their bona fide case through actual invoices and supporting documents. The court further called upon CBIC to introduce a practical mechanism to address the genuine hardship caused to recipients for factors entirely in the hands of their suppliers.

What this means for taxpayers: You cannot be denied ITC simply because your supplier was careless about filing his GSTR-1. You must be given a hearing and an opportunity to prove the genuineness of the purchase with documents.

3. Calcutta High Court — GSTR-2A/3B Mismatch Demand (November 2025)

In M/s Arjun Engineering Co. v. Additional Commissioner, CGST, North Delhi (Delhi High Court, 22 November 2025), the court remanded a GST mismatch demand arising from GSTR-3B, GSTR-2A, and GSTR-1 differences back for fresh adjudication, holding that the demand was passed in violation of the principles of natural justice.

4. Calcutta High Court — Suncraft Energy Case

The Calcutta High Court, in Suncraft Energy Pvt. Ltd. v. Assistant Commissioner, held that buyers who comply with the conditions under Section 16(2) of CGST Act are entitled to claim ITC and are not responsible for discrepancies in GSTR-2A and GSTR-3B arising due to the seller’s default. The court directed that action should first be taken against the selling supplier before any adverse action is taken against the purchasing taxpayer.

What the Annual Return Is — And What It Is NOT

Courts have also drawn an important line on the other side: GSTR-9 is a disclosure mechanism, not a correction tool or a substitute for timely monthly compliance. The annual return reflects reality — it does not rewrite it.

This means:

You cannot use GSTR-9 to make ITC claims that were never validly made in GSTR-3B within the time limits — unless the courts specifically allow it as they have in the Pioneer case for genuine bona fide errors

You cannot use GSTR-9 to amend outward supply figures beyond what is permitted by law

GSTR-9 is a mirror, not an eraser — it shows your full picture, but it cannot undo non-compliance

The message from the judiciary is balanced: The taxpayer must use the form correctly; the department must consider it fully. Neither party can ignore the annual return.

The Real Purpose of Annual Returns — And How the Department Is Defeating It

Let us ask the fundamental question: Why did Parliament mandate annual returns under Section 44 of the CGST Act?

The answer is clear from the legislative design:

To provide a complete, reconciled year-end picture of a taxpayer’s GST liability and ITC

To allow taxpayers to voluntarily correct inadvertent errors in monthly returns through DRC-03 payments, without being treated as evaders

To enable proper GST audit through GSTR-9C, where a CA certifies the reconciliation between GST returns and books of account

To give the department audited, certified information about a taxpayer’s compliance that goes beyond portal auto-population

To avoid the need for separate, disruptive departmental audits for small and medium businesses.

Now ask: Is the department achieving any of these purposes when it ignores GSTR-9C reconciliation, matches only Table 4 and Table 9 mechanically, and refuses to consider DRC-03 payments or late-uploaded supplier invoices?

The answer is no. The department is using the portal’s mechanical matching as a revenue-raising tool for bonafide taxpayers while allowing the actual problem — supplier non-compliance and fake invoice networks — to continue largely unaddressed. This defeats every purpose for which annual returns were mandated.

The Compliance Burden on Professionals: An Honest Assessment

Tax professionals — Chartered Accountants, GST practitioners, tax consultants — are spending enormous time and resources on GSTR-9 filings. Let us be honest about the scale of this work.

For a single client with moderate turnover above ₹2 crore, a proper GSTR-9 and GSTR-9C filing involves:

Reconciling 12 months of GSTR-1 with books of account

Reconciling 12 months of GSTR-3B with books of account

Matching GSTR-2B month by month with purchase registers

Identifying invoices not in GSTR-2B and following up with suppliers

Preparing a FY-wise ITC reconciliation statement (especially complex from FY 2024-25 with new Table 6A (1) and changed Table 8 logic)

Computing any additional tax liability and paying through DRC-03

Certifying all of the above in GSTR-9C

This is a full-scale accounts audit — not a return filing. It involves the same level of work as an income tax audit. And after all this effort, if the department simply compares Table 4 with Table 9 and issues a mismatch notice — ignoring the reconciliation, the DRC-03 payments, and the GSTR-9C certification — then the entire professional effort has been wasted.

The GST Council must recognise that this is not just a taxpayer problem. It is also causing professional burnout and increasing compliance costs for businesses at a time when the government should be reducing the burden on the trade and industry.

Specific Issues That Need Immediate Correction

Issue 1: Non-Editable Table 9 vs. Editable Table 4

The mechanical matching of non-editable Table 9 (GSTR-3B figures) with editable Table 4 (reconciled turnover) creates artificial mismatches that have no basis in tax evasion. The department must be instructed that where the difference is explained by DRC-03 payment or GSTR-9C reconciliation, no further demand should be raised.

Issue 2: ITC Based on GSTR-2B Alone is Legally Unjustified

Following the Gauhati High Court’s reading down of Section 16(2) (aa), the CBIC must issue a practical circular — as the court itself directed — creating a mechanism whereby a bona fide purchaser can prove ITC entitlement through actual invoices, payment records, and receipt of goods, independent of the portal’s GSTR-2B auto-population.

Issue 3: Table 8D “Lapsing” of Legitimate ITC

The concept that ITC not in GSTR-2B automatically “lapses” in Table 8D must be reconsidered. Where a taxpayer can demonstrate that the supply was genuine and the supplier eventually filed the GSTR-1 within the Section 16(4) window, the ITC must be allowed. The GSTR-9C reconciliation statement is the appropriate vehicle for this explanation, and the department must accept it.

Issue 4: Notices to Sub-₹2 Crore Taxpayers

If a taxpayer’s turnover is below ₹2 crore and GSTR-9 filing is not mandatory, the department cannot raise mismatch demands based on a portal-level comparison of GSTR-1 and GSTR-3B data without giving these taxpayers an opportunity to explain differences through their books of account. The very rationale for exempting small taxpayers from GSTR-9 is to reduce compliance burden — sending them mismatch notices defeats this purpose entirely.

Issue 5: Portal Glitches Creating Artificial Mismatches

GSTN portal glitches — such as the confirmed issue where amendments to B2C invoices of a prior year incorrectly affect Table 4 of GSTR-9 for the current year — create artificial mismatches that have nothing to do with taxpayer behaviour. The department cannot use AI-based scrutiny systems to generate demand notices based on portal errors. Before any notice is issued, the portal data must be verified for technical accuracy.

What Relief Can Taxpayers Seek Right Now?

Until the law and CBIC circulars catch up with these judicial pronouncements, here is what affected taxpayers and their advisors can do:

File a proper reply to every mismatch notice — do not ignore notices or pay under pressure. Attach the reconciliation workings, DRC-03 challans, and an explanation of every difference.

Cite the Pioneer Cooperative judgment (Calcutta HC, MAT/1983/2023) in your reply, urging the adjudicating authority to consider GSTR-9 filed on time as a complete and comprehensive disclosure.

Cite the McLeod Russel judgment (Gauhati HC, December 2025) for any ITC demand arising from GSTR-2B mismatch — the department is legally bound to give you an opportunity to prove bona fide purchases before denying ITC.

Cite the Suncraft Energy judgment (Calcutta HC) for demands where the ITC discrepancy arose due to supplier default — demand that action be first taken against the non-compliant supplier.

File a written request asking the adjudicating officer to specifically address why GSTR-9C reconciliation and DRC-03 payments are not being considered in the demand calculation.

If an order is passed ignoring GSTR-9, file an appeal and raise the specific ground that the order ignores the statutory annual return filed in time, making the annual return filing redundant — a position squarely rejected by the Calcutta High Court.

What the Government and GST Council Must Do

This article would be incomplete without specific recommendations for the authorities responsible for GST policy:

CBIC must issue a circular directing all assessing officers that mismatch notices cannot be raised by mechanical comparison of Table 4 and Table 9 of GSTR-9 alone. The GSTR-9C reconciliation and DRC-03 payments must be considered as part of the same compliance package.

CBIC must implement the Gauhati HC direction and create a practical mechanism for bona fide buyers to claim ITC beyond what is reflected in GSTR-2B, subject to document verification.

The GST Council should revisit Section 16(2) (aa) in light of consistent judicial adverse comments. Linking a buyer’s ITC entirely to supplier’s GSTR-1 compliance — without any effective mechanism to pursue the defaulting supplier — creates double taxation on innocent buyers.

The government must ensure consistency: If GSTR-9 is not mandatory below ₹2 crore, mismatch demands based on portal-level comparison must not be issued to these taxpayers without giving them full opportunity to explain through books.

GSTR-9 should not be filed if not going to be considered — this is the most fundamental demand. Mandatory annual return filing involves significant compliance cost and professional fees. If the department is going to ignore the reconciliation and certifications in GSTR-9C and go back to portal figures anyway, then the honest answer is that GSTR-9 serves no real purpose for the taxpayer. It serves only as a data collection exercise for the department while the cost falls entirely on the business.

Conclusion: The Annual Return Must Mean Something

“The purpose of filing an annual return under Section 44(1) of the Act would be rendered redundant if the annual return is not taken into account.”
— Calcutta High Court, Pioneer Cooperative Car Parking Servicing and Construction Society Ltd. v. State of West Bengal [MAT/1983/2023]x​

The GST system, in its design, is sound. The principle of ITC — that tax should be paid only on value addition — is economically correct. The annual return, if properly used, is a powerful tool for both taxpayer correction and departmental oversight.

But the system works only if all its parts are respected. A monthly return is part of the system. An annual return is part of the system. An audited reconciliation statement is part of the system. If the department uses the monthly returns to raise demands and ignores the annual return that corrects those returns, it is not implementing GST — it is selectively weaponising compliance data against honest taxpayers.

The judiciary has been remarkably consistent in this direction. The Gauhati High Court, the Calcutta High Court, the Delhi High Court, and the Kerala High Court have all, in different cases and different ways, said: Look at the substance. Look at the actual invoice. Look at the annual return. Don’t deny ITC to a bona fide buyer because of someone else’s failure.

It is time for the GST Council and CBIC to listen to this consistent judicial voice — and to give traders and business owners the relief that nine years of honest GST compliance deserves.

Footnotes

Footnote 1: Section 44 of the CGST Act, 2017 — Annual Return: Every registered person, except certain specified categories, shall furnish an annual return for every financial year by the 31st day of December following the end of such financial year.

Footnote 2: Section 16(2) of the CGST Act, 2017 — Conditions for claiming ITC: A registered person shall be entitled to take ITC only if he is in possession of a tax invoice or debit note, has received the goods or services, the tax charged in respect thereof has been actually paid by the supplier, and the person has furnished the return under Section 39.

Footnote 3: Section 16(2) (aa), inserted by Finance Act 2021 — additionally requires that the details of the invoice or debit note referred to in clause (a) have been furnished by the supplier in GSTR-1 and such details have been communicated to the recipient in GSTR-2B. This sub-clause has been read down by the Gauhati High Court in McLeod Russel India Limited (December 2025) to protect bona fide recipients.

Footnote 4: Form DRC-03 is the prescribed challan under the GST Rules for voluntary payment of tax — used by taxpayers to pay shortfalls identified during reconciliation at the time of filing GSTR-9, without it being treated as a demand or admission of evasion.

Footnote 5: Pioneer Cooperative Car Parking Servicing and Construction Society Ltd. v. State of West Bengal, Calcutta High Court [MAT/1983/2023, IA NO: CAN/1/2023] — Judgment directing fresh adjudication after considering GSTR-9; holding that ignoring an annual return filed on time would seriously prejudice the assessee’s rights.

Footnote 6: McLeod Russel India Limited v. Union of India & Others, Gauhati High Court, Order Date: 9 December 2025, Bench: Chief Justice Ashutosh Kumar & Justice Arun Dev Choudhury — Section 16(2) (aa) read down; ITC cannot be denied to bona fide buyers solely due to supplier’s GSTR-1 default without opportunity to prove genuineness.

Footnote 7: Suncraft Energy Pvt. Ltd. v. Assistant Commissioner, Calcutta High Court — ITC cannot be denied to buyers complying with Section 16(2) conditions due to seller’s default; action must first be taken against the defaulting seller.

Footnote 8: M/s Arjun Engineering Co. v. Additional Commissioner, CGST, North Delhi, Delhi High Court, 22 November 2025 — Mismatch demand remanded for violation of principles of natural justice.

This article is written for educational and publication purposes by a senior tax practitioner. It represents the author’s analysis of existing law, judicial pronouncements, and practical ground realities in GST compliance. It is not intended as legal advice for any specific case. Readers are advised to consult their tax advisors for case-specific guidance.