Patna HC Sets Aside GST Assessment Over Contradictory ITC Data & Remands Matter

Jagdamba Enterprises Vs Union of India (Patna High Court)

Summary: The Patna High Court considered a writ petition filed by M/s Jagdamba Enterprises challenging an order dated 14.12.2023 passed under Section 73 of the GST Act and the corresponding DRC-07 summary for the period 2017-18, under which tax, interest and penalty aggregating to Rs. 22,62,318/- had been imposed. The petitioner relied upon Annexure-P/2 containing auto-populated tax liability and ITC data and submitted that the ITC available as per GSTR-2A was Rs. 76,16,209.08/-, whereas the ITC actually claimed through GSTR-3B was Rs. 60,53,895.38/-.

Thus, according to the petitioner, the credit claimed was lower than the credit appearing in the auto-populated GSTR-2A data. The petitioner further pointed out that the GSTR-9 reflected ITC as per GSTR-2A at Rs. 25,40,879.28/- towards CGST and an equivalent amount towards State GST, aggregating to Rs. 50,81,750.56/-, which was stated to be inconsistent with the auto-populated data contained in Annexure-P/2. The petitioner contended that the incorrect figure appearing in GSTR-9 resulted from a technical error which could not be rectified at the petitioner’s end. Reliance was placed upon the Supreme Court decision in Central Board of Indirect Taxes and Customs Vs. M/s Aberdare Technologies Private Limited & Ors. and the Division Bench decision of the Patna High Court in Om Traders Vs. Union of India. The State, however, submitted that the ITC figure in GSTR-3B was a net figure after reversal of ITC, including reversal on account of reverse charge, and therefore could be lower than the amount reflected in GSTR-2A.