In a plethora of judgments various courts have taken a view that the procedural grounds can not supersede the provisions of the legislation. In line of those judgments recently the honorable Kerala High court in the matter of the St. Joseph Tea Company Ltd Vs. (i) The State Tax Officer (ii) Deputy Commissioner , State GST Department (iii) State Goods & Service Tax Department (iv) Goods & Service Tax Network Ltd {WP (C) No. 17235 of 2020}, has examined the facts of the case and accordingly ordered that the ITC shall not be denied only on the ground that the transaction is not reflected in GSTR 2A.
The key take away of the judgment are :
“I find merit in the submission that the fresh registration on 09.03.2018 having been obtained by the petitioner in terms of the interim order issued in W.P.(C) No.768 of 2018, an opportunity for statutory compliance for the period prior to 09.03.20218 ought to be provided. At the same time, there is substance in the submission made on behalf of the respondents that it is technically impossible to make changes in the GST portal for providing opportunity for an individual assessee to comply with the statutory requirements from a date prior to its registration.
In the circumstances, the only possible manner in which the issue can be resolved is for the petitioner to pay tax for the period covered by provisional registration from 01.07.2017 to 09.03.2018 along with applicable interest under Form GST DRC-03 dealing with intimation of payment made voluntarily or made against the show cause notice (SCN) or statement. If such payment is effected, the recipients of the petitioner under its provisional registration (ID) for the period from 01.07.20217 to 09.07.2018 shall not be denied ITC only on the ground that the transaction is not reflected in GSTR 2A. It will be open for the GST functionaries to verify the genuineness of the tax remitted and credit taken. Ordered accordingly.”
My comments:
Once the honorable court has clearly marked that the right of input Tax credit can not be withheld only by the reasons that it has not been reflected in the GST portal . Now the question arises what is the logic behind the introduction of Rule 36(4), 86A , 86B by the government and which is clearly not in consonance with the provisions of the GST Act. Also when the various courts are given the like judgments whether it is not indirectly marked the big question mark upon the constitutional validity upon the like and similar provisions where the right which is conferred by the express provisions of the act which knowingly or unknowingly gets defeated by making procedural provisions . We must understand that the rules , notifications , circular etc. are only issued for the smooth implementation of the provisions of the law and on the other hand such machinery provisions can not overrule or override the express provisions given in the statute.
This article is an endeavor to share some learnings obtained. The views expressed are of the author and are intended solely for informational purpose only. Though due care is taken while preparing the document, possibility of errors cannot be ruled out. Expert guidance, where required and reference to the original act, notification, circular, rules etc is highly recommended.
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(About the author – The author is a member of ICAI and can be reached at Email: nikhilkumarca@gmail.com, Mobile: 09936424523, Twitter : @CA_NikhilKumar, FB: canikhillko Office: Flat No. 102, First Floor, Vasundhara Complex, Ring Road, Sector-16, Indira Nagar, Lucknow-226016 , U.P., India)
Nikhil ji Good efforts for Tax profftional to share updates of GST related matters
Warm Regard
Adv.Subhash Kumar Bhardwaj.
Co.opted Member Punjab & Haryana Bar Council Chandigarh. Cell 9311177345.
Thanx a lot @ Adv S K Bhardwaj Sir for your appreciation and support. It means a lot to me .. Always need your support and blessings..
Warm Regards..
CA. Nikhil Kumar