2025 (4) TMI 550

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....in M. M., Government Pleader JUDGMENT Petitioner - a partnership firm, challenges an order of determination under Section 73(9) of the Central Goods and Services Tax Act, 2017 and State Goods and Services Tax Act, 2017 (for short, 'the CGST/ SGST Act'). Petitioner also challenges an order dismissing an application for rectification. 2. For the financial year 2018-19, petitioner was alleged to have availed excess input tax credit. A show cause notice was issued on 28.12.2023, calling upon the petitioner to explain why the excess ITC, wrongly availed to the tune of Rs. 3,51,00,063/-, should not be recovered under section 73(1) of the CGST Act. A reply was filed, stating that, immediately upon noticing the wrong availing of IT....

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.... year was shown as 2019-20 in DRC-03 instead of 2018-19. However, since there was no rejection of the intimation, petitioner could not identify the mistake. According to the petitioner, it is only logical to assume that the huge deposit was made for the year 2018-19, especially since there was no pending liability for the year 2019-20. Petitioner contended that the mistake in DRC-03 application referring to the period as 2019-20, was specifically clarified as only an error, but the authority ignored the said contention and by the impugned order dated 29.11.2024, the rectification petition was dismissed. Petitioner is aggrieved by the impugned order of determination under Section 73(9) of the CGST Act as well as the order dismissing its appl....

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....d solely for the reason that DRC-03 intimation referred to the period as 2019-20. In this context, it needs to be mentioned that as per Rule 142(2) of the CGST Rules, 2017, DRC-03 is only a mode of intimation and the proper officer is even bound to issue an acknowledgment accepting the payment in Form DRC-04. There is nothing to indicate that such an acknowledgment was given. In fact, in the application for rectification, it has been specifically claimed that DRC-03 submitted by the petitioner had not been rejected. If the application was rejected pointing out the mistake in the financial year, certainly the petitioner could have re-submitted the intimation with the corrected period, within the time available. 8. On verifying the records....

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....rors, they should not be penalised or imposed with an exorbitant amount, which is otherwise not liable to be paid. Such imposition will not have the backing of Article 265 of the Constitution of India. As noted earlier, if the intimation in DRC-03 contained a bonafide error in the financial year mentioned therein, and if there was in fact no such liability for the said financial year, it was always open to the proper officer to have rejected the said application immediately, which would have enabled the taxpayer to identify the mistake and correct it. Until the issuance of notice under section 73 of the CGST, the statute permits the petitioner to correct such bonafide errors by a self-verification of the assessment and payment of liability.....