Refund of sum deposited due to ITC discrepancy

[AMIT BATHAM]

Due to an ITC mismatch, one of my clients had to deposit tax via DRC-03 in August 2022 for the tax year 2018–2019. Following this, some suppliers who had not yet filed their GSTR-1 filed, and some suppliers issued certificates in accordance with Circular 183/15/2022 which was issued in Dec. 2022. During the case hearing, the assessing officer accepted the reply and and after giving credit of certificate and GSTR-2A passed a speaking order, stating that the refund requested in the notice's reply would be considered under the GST relevant section in a separate application. In December 2023, the order was passed. In the refund application, the assessing officer sent a notice stating that the applicant had voluntarily deposited tax and tax under section 73(5) via DRC-03, so it was not covered by excess tax payment and went against the legal system as defined by section 54 of the GST. Please advise me

AI Summary

Client Faces ITC Discrepancy; Tax Deposit Under Section 73(5) Hinders Refund Under Section 54; Legal Appeal Suggested A client faced an Input Tax Credit (ITC) discrepancy, leading to a tax deposit via DRC-03 for the 2018-2019 tax year. After suppliers filed GSTR-1 and issued certificates, the assessing officer acknowledged these in a December 2023 order, suggesting a separate refund application. However, the officer later noted the tax was voluntarily deposited under section 73(5), not qualifying as excess tax under section 54. Responses suggest checking for a deficiency memo or show cause notice, potentially reapplying or appealing. References include a Kerala High Court decision supporting refund claims. Participants emphasize the need for legal appeal due to potential adjudication errors.