AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2026 (4) TMI 205
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....on 37(3) of the CGST/MGST Act extending time limit for making rectification under Section 37(3) of the CGST/MGST Act till 30th November of the succeeding year from 01.10.2022 onwards to be effective from 01.07.2017; (c) that this Hon'ble Court be pleased to issue a Writ of Certiorari or a writ in the nature of Certiorari or any other appropriate writ, order or direction under Article 226 of the Constitution of India calling for the records pertaining to the Petitioner's case and after going into the validity and legality thereof to quash and set aside the Show Cause Notice bearing No. Mumbai-LTU-541/LTU-04/GST Audit/ADJ/ADT-02/2024-25/B-114 dated 28.05.2024 read along with Form GST DRC-01 bearing Ref. No. ZD270524057619Z dated 28.05.2024 issued by the Respondent No. 6 for the period 2019-20 [Exhibit "C"], and Order bearing No. Mumbai- NOD-E-1204/LTU-04/GST-Audit/DRC-07/ADJ/2024-25/B-239 dated 26.08.2024 read along with Form GST DRC-07 bearing Ref. No. ZD270824071252D dated 26.08.2024 passed by the Respondent No. 6 for the period 2019-20 [Exhibit "D"], to the extent adverse to the Petitioner; (d) that this Hon'ble Court be pleased to issue a Writ of Man....
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.... of the present Petition are set out hereinbelow: (i) The Petitioner is a Private Limited Company incorporated under the provisions of the Companies Act, 2013, and is, inter alia, engaged in providing digital utility solutions to small and medium businesses (merchants), enabling them to record credit transactions and collect receivables through its trademark application "Khatabook". (ii) On 1st February 2019, the Petitioner entered into an agreement with Kyte Technologies Inc., USA, for providing software development services, which qualify as "zero-rated supply". (iii) On 31st August 2019, the Petitioner raised an invoice for the month of August 2019 under a Bond without payment of IGST. The said services qualify as "export of services" within the meaning of Section 2(6) of the IGST Act and constitute zero-rated supply under Section 16 of the IGST Act. (iv) On 20th December 2019, while filing Form GSTR-3B for November 2019, the Petitioner inadvertently paid IGST amounting to Rs. 2,82,46,364/- in respect of the invoice dated 31st August 2019. Thereafter, the Petitioner filed Form GSTR- 1 for the period October to December 2019 on 21st February 20....
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....ngs. By the Impugned Order, Respondent No. 6 has denied the adjustment of excess IGST amounting to Rs. 2,82,46,364/- paid inadvertently by the Petitioner, against the ineligible ITC of Rs. 2,04,24,467/-. 5. The denial is premised on the ground that, under Section 37(3) of the CGST Act, any rectification or amendment of transactions reported in returns cannot be carried out beyond the due date prescribed, i.e., September following the end of the relevant financial year. Respondent No. 6 has held that since the rectification was undertaken in October 2020, beyond the prescribed time limit for Financial Year 2019-2020, the same cannot be permitted. 6. Learned Counsel Mr. Arun Jain appeared on behalf of the Petitioner. Ms. Shruti Vyas, learned Additional Government Pleader, along with Mr. Aditya R. Deolekar, AGP, appeared for the Respondent-Department. Learned Counsel Mr. Ram Ochani, along with Ms. Sangeeta Yadav, appeared for Respondent Nos. 3 and 4. 7. At the outset, learned counsel for the Petitioner submitted that the excess payment of IGST was a bona fide and inadvertent error on the part of the Petitioner, and therefore, the Petitioner was entitled to rectify the same. I....
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.... with Section 38 and sub-sections (9) and (10) of Section 39 need to be purposively interpreted. We cannot read sub-section (3) of Section 37 to mean that the assessee would be prevented from placing the correct position and having accurate particulars in regard to all the details in the GST returns being filed by the assessee and that there would not be any scope for any bona fide, and inadvertent rectification/correction. This would presuppose that any inadvertent error which had occurred in filing of the returns, once is permitted to be rectified, any technicality not making a window for such rectification, ought not to defeat the provisions of sub-section (3) of Section 37 read with the provisions of sub-section (9) of Section 39 read dehors the provisos. 13. In our opinion, the proviso ought not to defeat the intention of the legislature as borne out on a bare reading of sub-section (3) of Section 37 and sub-section (9) of Section 39 in the category of cases when there is a bona fide and inadvertent error in furnishing any particulars in filing of returns, accompanied with the fact that there is no loss of Revenue whatsoever in permitting the correction of such ....
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....dit stands reflected in the wrong column. It is in these circumstances, after examining the relevant provisions which we have already discussed, the learned Single Judge observed that in the absence of an enabling mechanism, the assessee should not be prejudiçed from availing credit which they are otherwise legitimately entitled to. The court observed that an error committed by the petitioner is an inadvertent human error and the petitioner should not be prevented from rectifying the same and accordingly, allowed the petition. 17. A similar view was taken in the Pentacle Plant Machineries (P) Ltd. case? which also followed the decision in Sun Dye Chem case (supra). 18. We also note that the Division Bench of the Orissa High Court in Shiva Jyoti Construction case was considering the case wherein the petitioner had prayed for a relief that the petitioner be permitted for rectify the GST returns filed in September 2017 and March 2018 which was filed inadvertently in Form B2B instead of Form B2Cuas was wrongly filed under the GSTR I in order to get input tax credit benefit by a third party, namely, M/s Odisha Construction Corporation Ltd. The last date for fili....
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.... minus the proviso, have permitted rectification of inadvertent errors. 21. We may also observe that the situation like in the present case, was also the situation in the proceedings before the different High Courts as noted by us above, wherein the errors of the assessee were inadvertent and bona fide. There was not an iota of an illegal gain being derived by the assessees. In fact, the scheme of the GST laws itself would contemplate correct data to be available in each and every return of tax, being filed by the assessees Any incorrect particulars on the varied aspects touching the GST returns would have serious cascading effect, prejudicial not only to the assessee, but also to the third parties. 22. It is considering such object and the ground realities: the law would be required to be interpreted and applied by the department. This necessarily would mean, that a bona fide, inadvertent error in furnishing details in a GST return needs to be recognised, and permitted to be corrected by the department, when in such cases the department is aware that there is no loss of revenue to the Government. Such freeplay in the joint requires an eminent recognition. the dep....