2023 (10) TMI 98 - HC - GST

Input Tax Credit Claim: Discrepancies Cannot Automatically Disqualify Taxpayer from Claiming Legitimate Credits Under GST Law

M/s. Henna Medicals Versus State Tax Officers, Deputy Commissioner (Arrear Recovery) Office Of The Joint Commissioner, State Goods And Service Tax Kannur, Union Of India, Central Board Of Indirect Taxes & Customs, State Of Kerala

SC/HC ruled that denial of input tax credit solely based on discrepancies between GSTR 2A and GSTR 3B is invalid. The court directed the Assessing Officer ... Input tax credit - only ground on which the petitioner has been said to have availed the input tax credit is the difference between GSTR 2A and GSTR 3B - HELD THAT:- This Court, after taking note of the judgment of the Supreme Court in the case of THE STATE OF KARNATAKA VERSUS M/S ECOM GILL COFFEE TRADING PRIVATE LIMITED [2023 (3) TMI 533 - SUPREME COURT] as well as Calcutta High Court judgment in SUNCRAFT ENERGY PRIVATE LIMITED AND ANOTHER VERSUS THE ASSISTANT COMMISSIONER, STATE TAX, BALLYGUNGE CHARGE AND OTHERS [2023 (8) TMI 174 - CALCUTTA HIGH COURT] has held that the input tax credit of the assessee under the GST regime cannot be denied merely on the difference of GSTR 2A and 3B. The matter is remitted back to the file of the Assessing Authority/1st respondent to examine the evidence of the petitioner irrespective of the Form GSTR 2A for the petitioner's claim for the input tax credit. After examination of the evidence placed by the petitioner/assessee, the Assessing Authority shall pass fresh orders in accordance with the law - Petition allowed by way of remand. Issues involved:The judgment deals with the denial of input tax credit based on the difference between GSTR 2A and GSTR 3B in an assessment order, and the validity of such denial.Details of the Judgment:Issue 1: Denial of input tax credit based on GSTR 2A and GSTR 3B differenceThe petitioner challenged the assessment order and recovery notice claiming input tax credit of Rs. 2,58,116/- with interest and penalty totaling approximately Rs. 4,58,156/-. The Court referred to the Supreme Court judgment in The State of Karnataka v. M/s Ecom Gill Coffee Trading Private Limited and a Calcutta High Court judgment, holding that denial of input tax credit solely based on the difference between GSTR 2A and GSTR 3B is not valid under the GST regime.Issue 2: Remand for re-examination of input tax credit claimReferring to the Diya Agencies v. The State Tax Officer judgment, the Court directed the matter to be remanded back to the Assessing Officer for re-examination of the petitioner's evidence for the input tax credit claim. The Assessing Officer was instructed to provide an opportunity to the petitioner to prove the genuineness of the claim, emphasizing that denial based on GSTR-2A alone is insufficient. The petitioner was directed to appear before the Assessing Authority with all evidence to support the claim for input tax credit by a specified date.Conclusion:The writ petition was allowed, and the matter was remitted back to the Assessing Authority for a fresh examination of the petitioner's evidence for the input tax credit claim, irrespective of the GSTR 2A. The petitioner was directed to appear before the Assessing Officer with all supporting evidence on a specified date for further proceedings in accordance with the law.