2024 (9) TMI 97 - HC - GST

Challenge to adjudication order passed under Section 73(9) of the CGST/WBGST Act, 2017 dated 29th April, 2024 issued in Form GST/DRC 07 - ITC, availed in GSTR-3B was filed after the last date prescribed u/s 16 (4) of the said Act - HELD THAT - Taking note that a sum of Rs. 63,28,114/- was found to be reversible, as would appear from the show cause notice, for reasons of the petitioners having availed ITC by filing GSTR-3B after the last date and since, from the Finance Bill No.02, being Bill No. 55 of 2024, it would appear that in Clause 114, amendment of Section 16 of the said Act has been proposed thereby making a provision to give benefit to those registered tax payers who are entitled to Input Tax Credit and have filed a return under Section 39 of the said Act up to 30th November, 2021, in respect of an invoice or debit note for supply of goods or services or both pertaining to the Financial years 2017-18, 2018-19, 2019-20 and 2020-21, and since the petitioner had filed Form 3B for the Tax period 2018-2019, belatedly but before 30th November, 2021, the petitioners at this stage is entitled to an interim order, as the finance bill no.2 of 2024 takes care of a major part of the determination made under Section 73 of the said Act for the Financial Year 2018-19. Such interim order is necessary to avoid multiplicity of judicial proceedings. The petitioners are directed to make a deposit with the learned Registrar General a sum of Rs. 25 lakhs within a period of 3 weeks from date. If the aforesaid amount is deposited with the learned Registrar General, the same shall be invested in any interest bearing fixed deposit account with any Nationalized Bank of his / her choice and the same shall be kept renewed until further order of this Court. Petition disposed off.

Summary

Issues:
1. Challenge to adjudication order under Section 73(9) of CGST/WBGST Act, 2017.
2. Claim of Input Tax Credit (ITC) based on late filing of GSTR-3B.
3. Proposed amendment to Section 16(4) of the Act affecting ITC benefits.
4. Entitlement to interim relief pending the passing of the Finance Bill.

Analysis:
1. The petition challenges an adjudication order under Section 73(9) of the CGST/WBGST Act, 2017, issued on 29th April, 2024, in Form GST/DRC 07. The challenge is not pressed on Prayer-A but is confined to other prayers in the writ petition.

2. The issue revolves around the claim of ITC based on returns filed by the petitioner after the prescribed deadline under Section 16(4) of the Act. The petitioner's ITC claims in GSTR-3B were found reversible due to filing after the deadline, leading to the initiation of the present writ petition.

3. A significant development is the proposed amendment to Section 16(4) of the Act through the Finance Bill No.2 of 2024, which aims to allow registered persons to benefit from ITC in returns filed under Section 39 of the Act until 30th November, 2021, for specific financial years. This proposed amendment could impact the petitioner's entitlement to ITC worth Rs. 63,28,114.

4. The Court acknowledges the potential impact of the pending Finance Bill on the petitioner's case and grants interim relief. Despite the bill not yet becoming an Act, the Court deems it appropriate to provide interim protection to the petitioner, considering the proposed amendment's relevance to the petitioner's ITC claims for the financial year 2018-19. An interim order is issued to prevent multiple legal proceedings and directs the petitioner to make a deposit of Rs. 25 lakhs within three weeks to secure part of the determination already made. Additionally, the respondents are restrained from taking coercive actions for three weeks, subject to compliance with the payment directive. The interim relief is set to continue until the end of September 2024 or further orders, depending on the situation.

This detailed analysis covers the key issues raised in the legal judgment, outlining the challenges faced by the petitioners regarding ITC claims, the proposed legislative amendment affecting their case, and the interim relief granted by the Court pending the passage of the Finance Bill.