Zach Rubber Private Limited Vs State Tax Officer (Kerala High Court)
The Kerala High Court considered a writ petition filed by a registered taxpayer challenging an order passed under Section 73 of the CGST/SGST Act, 2017. The impugned order identified two defects: first, that the petitioner had not filed the return for March 2020 within the period prescribed under Section 16(4) of the CGST Act; and second, that excess input tax credit had been availed based on the entries in GSTR-2A.
The petitioner stated that the amount determined in relation to the second defect had already been remitted and confined the dispute to the rejection of input tax credit for March 2020 on the ground of violation of Section 16(4).
The petitioner relied upon Section 16(5) of the CGST Act, contending that where the return was furnished on or before 30.11.2021, the taxpayer would be entitled to claim input tax credit. Referring to the returns produced, the Court noted that the petitioner had filed the relevant return on 17.11.2020, which was within the cut-off date contemplated under Section 16(5).
Accordingly, the High Court quashed the impugned order to the extent it denied the input tax credit claimed for March 2020 on the ground of violation of Section 16(4). The Court directed the first respondent to reconsider the matter and grant the benefit of input tax credit for March 2020 in the light of Section 16(5), if the petitioner was otherwise entitled to the same. Fresh orders were directed to be passed within three months after affording the petitioner an opportunity of hearing.
FULL TEXT OF THE JUDGMENT/ORDER OF KERALA HIGH COURT
The petitioner is a registered tax payer under the provisions of CGST/SGST Act. The challenge raised by the petitioner is against Ext.P1 order passed under Sec.73 of the CGST/SGST Act 2017. As per Ext.P1, two defects were noted by the 1st respondent. The first defect was that, the petitioner failed to submit returns for the month of March, 2020 within the period contemplated under Sec.16(4) of the CGST Act. The second defect was that, when examining the entries in GSTR 2A, it was found that the petitioner obtained excess input tax credit. According to the petitioner, as far as the 2nd defect is concerned, the petitioner had already remitted the amount determined and the dispute is confined to the 1′ defect, which is the rejection of input tax credit claimed by petitioner alleging violation of Sec.16(4) of the CGST Act.
2. The challenge against the said defect is mainly by placing reliance upon Sec.16(5) of the CGST Act, which provides that, in case the return is submitted on or before 30.11.2021, such taxpayer would be entitled to claim input tax credit. In this case, it is discernible from Ext.P6 returns that, the petitioner had submitted the returns on 17.11.2020 and thus, it is within the cutoff date contemplated under Sec.16(5) of the CGST Act and therefore, the petitioner is entitled for the relief.
Accordingly, this writ petition is disposed of, quashing Ext.P1, to the extent it declined the input tax credit claimed by the petitioner for the month of March, 2020, on the ground of violation of Sec.16(4) of the CGST Act, with a direction to the 1st respondent to reconsider the matter and grant the benefits of the input tax credit for the month of March, 2020 in the light of Sec.16(5) of the CGST Act, if the petitioner is otherwise entitled to the same. Necessary orders in this regard shall be passed within a period of three months from the date of receipt of copy of this judgment, after affording an opportunity of hearing to the petitioner.
