2023 (11) TMI 137 - HC - GST

Input Tax Credit - denial on the ground that there is mismatch in GSTR 2A and GSTR 3B - HELD THAT - As per the stand of the petitioner/assessee, the tax for which the petitioner claimed input tax credit is reflected in Form GSTR 2A, though with some delay, the claim of the petitioner for input tax credit which has been denied in Exhibit P1 does not appear to be correct. To prove his case, one opportunity is granted to the petitioner to appear before the Assessing authority, within seven days from today with all relevant documents. The present writ petition is allowed. Impugned order Exhibit P1 and notice Exhibit P2 are set aside.

Summary

Issues:
The denial of input tax credit based on mismatch between GSTR 2A and GSTR 3B.

Details of the Judgment:

Issue 1: Denial of Input Tax Credit
The petitioner's input tax credit was denied due to a mismatch in GSTR 2A and GSTR 3B. The petitioner claimed the input tax based on valid invoices available with them, explaining that certain suppliers had uploaded data in GSTR-1 as '0' tax items due to technical issues on the website.

Issue 2: Proceedings and Order
The reply submitted by the petitioner was deemed unsatisfactory, leading to the issuance of GST DRC-01A and a notice under Section 73 of the State Goods and Services Tax Act, 2017. Subsequently, an order was passed for the denied input tax amount, interest, and penalty. A recovery notice was also issued for the realization of the said amount.

Issue 3: Petitioner's Submission
The petitioner's counsel argued that the tax collected by the supplier for inward supply was remitted with some delay, but there was no difference between the GSTR 3B and GSTR 2A. The petitioner sought an opportunity to prove that the claimed input tax credit was correct and reflected in GSTR 2A.

Issue 4: Legal Precedent
The petitioner's counsel cited a previous judgment of the Court, emphasizing that denial of input tax credit solely based on the GSTR-2A and GSTR-3B difference should not be accepted if the assessee can demonstrate through evidence that the tax was paid to the supplier.

Issue 5: Conclusion and Decision
The Court acknowledged that the tax for which the petitioner claimed input tax credit was reflected in GSTR 2A, albeit with a delay in some instances. Consequently, the petitioner was granted an opportunity to appear before the Assessing authority with relevant documents. The impugned order and recovery notice were set aside, and the petitioner was directed to prove the bonafide nature of the input tax credit claim for a revised order to be issued if satisfied.