2020 (3) TMI 155 - HC - Service Tax

Filing of revised return - time limit for filing of revised return - Rule 7B of Service Tax Rules-1994 - HELD THAT - On perusal of the Rule 7B of the Rules-1994, it permits the assessee to file revised return in form ST-3, in triplicate, to correct a mistake or omission, within a period of ninety days from the date of submission of return under Rule 7. Rule 7 prescribes for return to be filed under Form ST-3. As per rule 7B, it appears that the assessee can revise the return filed under Rule 7 within a period of 90 days from the date of submission of the original return under Rule 7 of the Rules 1994. Rule 7B only permits the assessee to revise the mistake or omission in the return filed under Rule 7 within a period of 90 days. If the assessee finds any mistake in the form ST-3 file under Rule 7 of the Rules1994, he can revise the same in multiple documents within prescribed period. The intention of the framing of the Rule is to revise return Form ST-3 filed under Rule 7 of the Rules-1994. The stand taken by the respondents that once option is exercised to revise the original return then the assessee cannot file revised return again within prescribed time period under Rule 7B of the Rules-1994 is not tenable. ACES portal not allowing the petitioner to revise the Form ST-3 for the second time within prescribed period resulting into technical glitches is contrary with the provisions of Rule 7B of Rules-1994. In the opinion of the the Court, the respondents have failed to consider the aspect of technical glitches to reject the claim of the petitioner on the ground that the petitioner has no option to revise the return in Form ST-3 once the original return is revised by the petitioner - the respondents are hereby directed to consider the claim of the petitioner for the amount of ITC of ₹ 99,46,810/- manually under Rule 7B of the Rules-1994, so as to enable the petitioner to take advantage of the order dated 07.02.2020 to revise the Form Tran-1 to be filed online on or before 31.03.2020. Petition disposed off.

Summary

Issues:
- Claim for Input Tax Credit for the period from 1st April, 2017 to 30th June, 2017
- Petitioner's request to revise tax return for the same period due to technical glitches
- Denial of Input Tax Credit by the respondent authorities
- Interpretation of Rule 7B of the Service Tax Rules, 1994
- Petitioner's entitlement to claim Input Tax Credit under CGST Act-2017
- Technical glitches preventing the petitioner from filing a second revised return
- Respondents' failure to consider technical glitches in rejecting the claim

Analysis:
1. The petitioner sought relief to allow Input Tax Credit (ITC) for the period from 1st April, 2017 to 30th June, 2017, as per Tran1. The petitioner filed a revised Form ST-3 to claim ITC of &8377; 6,94,19,228/- but later found more unaccounted invoices, resulting in ITC of &8377; 99,46,810/- left out. Attempts to file a second revised return were hindered by the online portal, leading to a request to the tax authorities for consideration of the additional ITC claim.

2. The respondent authorities, citing Rule 7B of the Service Tax Rules, 1994, contended that once the original return is revised, no provision exists for a second revision. They demanded the petitioner to reverse or pay the differential amount of &8377; 99,46,810/-, emphasizing that the petitioner's claim for additional ITC was not permissible under the rules.

3. The Court analyzed Rule 7B, which allows for a revised return within 90 days from the original submission to correct mistakes or omissions. It noted that the rule permits multiple revisions within the prescribed period, emphasizing the intention to revise the Form ST-3 filed under Rule 7. The Court found the respondents' interpretation flawed, as technical glitches preventing a second revised return conflicted with Rule 7B.

4. Considering the technical issues faced by the petitioner and the discrepancy in ITC amounts between Form ST-3 and Form Tran-1, the Court directed the respondents to manually consider the petitioner's claim for the differential ITC of &8377; 99,46,810/- under Rule 7B. The respondents were instructed to verify the claim and enable the petitioner to revise Form Tran-1 online by a specified deadline, ensuring the petitioner's entitlement to the claimed ITC.

5. The judgment highlighted the respondents' failure to address the technical glitches and ruled in favor of the petitioner, granting relief by directing the authorities to facilitate the processing of the additional ITC claim. The Court emphasized the importance of considering genuine claims and rectifying technical issues to uphold the petitioner's right to claim Input Tax Credit under the CGST Act-2017.