Facts:
In transition phase, several issues cropped up which had a significant impact on tax paid, the output liability, and the ITC of the Petitioner and led to occurrence of several inadvertent errors. To illustrate a few, invoices were accidently missed while filing Form GSTR-3B; credit notes pertaining to the invoices issued under the erstwhile regime were overlooked and, as a result, the output tax liability was over-reported; certain transactions like stock transfer from one place of business to another under the same GST Registration was reported as supply;.
To sum it up, the paramount grievance of the Petitioner is that during the period from July, 2017 to September, 2017 (hereinafter referred to as ‘the relevant period’), the Petitioner in its monthly GSTR- 3B recorded the ITC based on its estimate.
As a result, when the Petitioner had to discharge the GST liability for the relevant period, the details of ITC available were not known and the Petitioner was compelled to discharge its tax liability in cash, although, actually ITC was available with it but was not reflected in the system on account of lack of data. The exact ITC available for the relevant period was discovered only later in the month October 2018, when the Government operationalized Form GSTR-2A for the past periods.
Thereupon, precise details were computed and Petitioner realized that for the relevant period ITC had been under reported.
The Petitioner alleges that there has been excess payment of taxes, by way of cash, to the tune of
approximately Rs. 923 crores.This was occasioned to a great degree due to non-operationalization of Forms GSTR-2A, GSTR-2 and GSTR-3 and the system related checks which could have forewarned the petitioner about the mistake.
Case:
W.P.(C) 6345/2018 | Judgement Date : 5th May, 2020
Petitioner – BHARTI AIRTEL LIMITED
Respondents – UNION OF INDIA & ORS.
Judgement:
The Court also referred to some Hon’ble supreme court decision one of them is “to impose a limitation on the exemption notification which the exemption notification itself did not provide. It was not open to the Board to whittle down the exemption notification in such a manner”
Merely if there is any fanciful or absurd outcome in a given situation, as illustrated by Respondents , it does not mean that the Petitioner should not be given the benefit of rectification if the same is genuine. The correction mechanism is critical to sustaining successful implementation of GST.
Thus, in light of the above discussion, the rectification of the return for that very month to which it relates is imperative and, accordingly, we read down para 4 of the impugned Circular No. 26/26/2017-GST dated 29.12.2017 to the extent that it restricts the rectification of Form GSTR-3B in respect of the period in which the error has occurred.
Accordingly, we allow the present petition and permit the Petitioner to rectify Form GSTR-3B for the period to which the error relates, i.e. the relevant period from July, 2017 to September, 2017.
We also direct the Respondents that on filing of the rectified Form GSTR-3B, they shall, within a period of two weeks, verify the claim made therein and give effect to the same once verified.
In view of the fact that the final relief sought by the Petitioner has been granted and the petition is allowed, no separate order is required to be passed in the application seeking interim relief
The Hon’ble Delhi High Court allowed petitioner to rectify Form GSTR-3B.
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Mr. Setia is a CA by Profession and expert in the field of Indirect Taxation Based in Delhi. Rich experience of over 5 year.