2025 (11) TMI 1918 - HC - GST

Writ against recovery of irregular ITC held premature; remedy lies in adjudication considering retrospective Section 16(5)

HC dismissed the writ petition challenging recovery of allegedly irregularly availed ITC as premature, noting the availability of an alternative and more ... Recovery of irregular/wrongly availed Input Tax Credit with interest and penalty - belated availing of input that credit and that in view of the statutory intervention by insertion of Sections 16(40 and 16(5) of the respective GST enactments - extension of the deadline for availing ITC - HELD THAT:- Reliance placed in SRI GANAPATHI PANDI INDUSTRIES, REP. BY ITS PROPRIETOR VERSUS THE ASSISTANT COMMISSIONER (STATE TAX) (FAC) TONDIARPET ASSESSMENT CIRCLE, CHENNAI [2024 (10) TMI 1631 - MADRAS HIGH COURT] where it was held that 'This Court considering the fact that the issue involved in all these Writ Petitions is only with regard to the availment of ITC, which is barred by limitation in terms of Section 16 (4) of the CGST Act, and in the light of the subsequent developments took place, whereby, Section 16 of the CGST Act was amended and sub-section (5) was inserted to Section 16, which came into force with retrospective effect from 01.07.2017, the petitioners are entitled to avail ITC in respect of GSTR-3B filed in respect of FYs 2017-18, 2018-19, 2019-20 and 2020-21 as the case may be, on or before 30.11.2021, is inclined to quash the impugned orders.' The case of the peittioner prima facie appears to be squarely convered by the aforesaid decision. The petitioner is therefore not precluded from relying on the same before the respondent in the adjudication proceedings. Therefore, this Writ Petition is dismissed in view of the availability of an alternative and more effective remedy the challenge to the show cause notice is also premature. Hence, without expressing any further opinion on the merits of the case, this case is dismissed with liberty to the petitioner to work out the remedy. The petitioner can participate in the adjudication proceedings pursuant to the impugned notice. The petitioner shall therefore file a reply within a period of 30 days from the date of receipt of a copy of this order. Thereafter, the respondent shall pass appropriate orders on merits - petition dismissed. The writ petition challenged a show cause notice dated 30.05.2024 proposing demand of Rs.10,962/- as 'irregular/wrongly availed Input Tax Credit' under Section 73(1) of the CGST Act, along with interest under Section 50(1) and penalty under Section 73(1) read with Section 122(2)(a) of the CGST/TNGST Acts. The petitioner contended that the issue concerned belated availing of ITC and that, pursuant to insertion/amendment of Sections 16(4) and 16(5) and the 53rd GST Council recommendations, the deadline for filing GSTR-3B for FYs 2017-18 to 2020-21 stood extended, with the 'new deadline deemed to be as '30.11.2021'.' The impugned notice, however, treated 28.10.2020 as the last date. The Court held that the matter is covered prima facie by an earlier decision (Sri Ganapathi Pandi Industries) and that the petitioner can rely on that ruling before the authority. The writ petition was dismissed as premature, in view of an effective alternative remedy, with liberty to file a reply within 30 days and participate in adjudication.