Refund of GST

[Guest]

We have rendered the services within state and raising the 2 Invoices and also have discharged the liability as per section 9. But recipient has not availed ITC on the said invoices and not informed to supplier. The supplier has come to know after filing all the returns including annual returns that invoices has wrongly made hence they have not availed any ITC on it. Now we have filed the GST refund which has got rejected. We are planing to go for an appeal. Please provide a case law if any for processing of appeal.

[Amit Agrawal]

I have not understood full context of your situation.

Kindly elaborate if said invoices were part of your turnover as disclosed in books of accounts, GSTR-9 & 9C and income tax submissions OR not? And if yes, whats is you basis to now claim that underlying supply is not made?

Just because recipient has not availed ITC against your invoices, same - by itself - is not sufficient to claim the refund by the supplier, in my humble view.

These are ex facie views of mine and the same should not be construed as professional advice / suggestion.

[KASTURI SETHI]

On what grounds refund has been rejected ? Pl. post brief facts of the case.

[Shilpi Jain]

What is the error in the invoices already issued?

[Padmanathan KV]

From my limited understanding of your query, I believe you have a weak case for appeal. I would like to extract Section 37 for your easy reference:

(3) Any registered person, who has furnished the details under sub-section (1) for any tax period ⁸[****], shall, upon discovery of any error or omission therein, rectify such error or omission in such manner as may be prescribed, and shall pay the tax and interest, if any, in case there is a short payment of tax on account of such error or omission, in the return to be furnished for such tax period:

Provided that no rectification of error or omission in respect of the details furnished under sub-section (1) shall be allowed after ⁹[the thirtieth day of November] following the end of the financial year to which such details pertain, or furnishing of the relevant annual return, whichever is earlier.

¹[Provided further that the rectification of error or omission in respect of the details furnished under sub-section (1) shall be allowed after furnishing of the return under section 39 for the month of September, 2018 till the due date for furnishing the details under sub-section (1) for the month of March, 2019 or for the quarter January, 2019 to March, 2019.]

Thus when law itself has provided mechanism for amendment rectify invoices and that amendment has not been made with in such time, remedy in appeal seems difficult. Circular 26/26-2017 GST also discusses various mistakes and suggested rectification.

However you may try writ before High Court. See Y.B. Constructions Pvt Ltd. vs Union of India - 2023 (3) TMI 111 - ORISSA HIGH COURT, where in High Court of Orissa has permitted amendment of GSTR-1 even after time limit is over.

AI Summary

Rectification of GST returns: time barred invoice amendments limit refund claims, with writ relief as a narrow alternative. Refunds cannot be claimed merely because a recipient did not take ITC; suppliers must verify that invoices were reflected in declared turnover and returns. The statutory amendment mechanism must be used to rectify invoice errors and pay any tax and interest within prescribed time limits, and failure to do so limits refund and appeal remedies, though administrative guidance and writ petitions have been invoked in exceptional cases.