2024 (4) TMI 993 - HC - GST

Demand of late fee u/s 47(1) of the CGST / SGST Act - delay in filing of returns - Amnesty Scheme - GST portal does not support payment of late fee for late filing GSTR-9C - date of filing of the GSTR-9C - HELD THAT - From the reading of the amended Section 44, it would be relevant to note that two key changes have been made by the Finance Act, 2021 with effect from 01.08.2021 i.e Section 35(5) CGST / SGST Act stands omitted, Section 44 of the CGST / SGST stands substituted. Form GSTR-9C becomes applicable to taxpayers with an annual aggregate turnover of more than Rs. Five Crores. CA/ CMA certification stands removed from financial years 2020-2021. With effect from 01.08.2021, taxpayers are now required to self-certify a voluntary reconciliation statement and file it with the tax authorities on or before 31st December of the year following the relevant financial year. The format of Form GSTR-9C has been modified to support self-certification. It is evident from amended Section 44 which provides that the taxpayer shall furnish an annual return which may include a self-certified reconciliation statement, with the audited annual financial statement. It is not in dispute that the GST portal does not support payment of late fee for late filing GSTR-9C. The GST portal enables to charge late fee for GSTR-9 only. The other returns for which the late fee is collected are GST 3B (monthly return) GSTR 4 (annual return of composition levy) GSTR-5 (return for non-resident taxable person), GSTR-5A (summary return reporting OIDAR service from outside India made to non-taxable persons in India), GSTR-6 (monthly return by input service distributor), GSTR-7 (returns for persons deducting TDS), and GSTR-8 (monthly returns for e-commerce operators). Annual return GSTR-9 filed without 9C may be deficient attracting general penalty. However, late fee cannot be made applicable for regularising the GSTR-9 by filing GSTR-9C. The Government itself has waived late fee under the two notifications Nos. 7/2023 dated 31.03.2023 and 25/2023 dated 17.07.2023 in excess of Rs. 10,000/-, in case of non-filers there appears to be no justification in continuing with the notices for non-payment of late fee for belated GSTR-9C, that too filed by the taxpayers before 01.04.2023, the date on which one time amnesty commences. Thus, the notices are unjust and unsustainable to the extent it sought to collect late fee for delay in filing GSTR-9C. However, it is made clear that the petitioners will not be entitled to claim refund of the late fee which has already paid by them over and above Rs. 10,000/- With aforesaid directions, all these writ petitions stand allowed.

Summary

Issues Involved:

1. Applicability of late fee for filing GSTR-9C.
2. Interpretation and applicability of the Amnesty Scheme.
3. Compliance requirements under the amended CGST/SGST Act and Rules.

Issue-wise Detailed Analysis:

1. Applicability of Late Fee for Filing GSTR-9C:

The core issue pertains to whether a late fee is applicable for the belated filing of the GSTR-9C reconciliation statement. The petitioner argued that under Section 47(2) of the CGST/SGST Act, a late fee is leviable only for the late filing of the annual return in FORM GSTR-9, not for the GSTR-9C reconciliation statement. The respondent, however, calculated the late fee based on the date of filing GSTR-9C, treating it as an integral part of the annual return filing process. The court noted that the GST portal does not support the payment of a late fee for late filing of GSTR-9C, indicating that such a fee is not applicable for GSTR-9C. The judgment concluded that notices demanding late fees for GSTR-9C were unjust and unsustainable.

2. Interpretation and Applicability of the Amnesty Scheme:

The petitioner sought relief under the Amnesty Scheme, which waived late fees in excess of Rs. 10,000 for non-filers of GSTR-9 returns for specific financial years. The petitioner had filed the returns before the commencement of the Amnesty Scheme, arguing that they should benefit from the scheme. The respondent contended that the Amnesty Scheme applied only to those who had not filed returns before 01.04.2023. The court observed that the government's notifications under the Amnesty Scheme waived late fees for non-filers, indicating a broader intent to alleviate compliance burdens. The judgment favored the petitioner's interpretation, allowing them the benefits of the Amnesty Scheme.

3. Compliance Requirements under the Amended CGST/SGST Act and Rules:

The judgment examined the compliance requirements under the amended provisions of the CGST/SGST Act and Rules. It highlighted the significant amendments brought by the Finance Act, 2021, effective from 01.08.2021, which included the omission of Section 35(5) and the substitution of Section 44. These amendments altered the filing requirements for GSTR-9C, making it a self-certified reconciliation statement for taxpayers with a turnover exceeding Rs. Five Crores. The court clarified that while Rule 80 mandates GSTR-9C for certain taxpayers, the late fee provisions do not extend to GSTR-9C, reinforcing the judgment's stance against the imposition of late fees for GSTR-9C.

Conclusion:

The judgment allowed the writ petitions, ruling that the notices demanding late fees for the delay in filing GSTR-9C were unjust and unsustainable. The court directed that the petitioners would not be entitled to claim a refund for any late fee already paid over Rs. 10,000, aligning with the Amnesty Scheme's provisions. The decision underscores the importance of correctly interpreting statutory provisions and government notifications to ensure fair compliance burdens on taxpayers.