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TMI Blog2024 (12) TMI 51X X X X Extracts X X X X X X X X Extracts X X X X ..... 37 (3) of the Act, is linked directly and proportionately to Section 16 (4) of the Act. In terms of the aforesaid provisions, input tax credit can be availed till the due date of furnishing the return under Section 39 of the Act for the month of September following the end of the financial year to which the invoice / debit note pertains or furnishing of the annual return, whichever is earlier. The correction in the corresponding GSTR-1 is permissible in terms of the timeline as specified in Section 16 (4) of the Act. The petitioner could not detect the error of mentioning the point of sale as Mumbai instead of Delhi and the mentioning of the GST number of purchaser of Mumbai instead of GST number of purchaser of Delhi which has resultant, as per his submissions, loss to the concerned purchaser, who could not avail the ITC. Last date of submission for rectification/ omission, admittedly falls on 30.11.2022 for the concerned petitioner. In Bharti Airtel s case [ 2021 (11) TMI 109 - SUPREME COURT] , the Supreme Court was considering the question of similar nature. In the said case, the Bharti Airtel has erroneously deposited cash and submitted that if it was allowed to rectify Form GS ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l Goods and Services Tax Act, 2017 (for short, the Act ). 2. Learned counsel for the petitioner submitted that the petitioner company is a limited company and was registered with GSTIN No. 06AAACB2892A1Z5. It is dealing with solutions in Enterprise Mobility, Bar Coding, RFID and EWLAN for supply chain and asset management in the retail, manufacturing and logistics market verticals. 3. Pursuant to the order placed by purchaser FedEx Express Transportation Supply Chain Services (India) Private Limited, the petitioner company issued invoices to the purchaser for financial year 20212022 where erroneously at the time of filing of GSTR-1 return, the petitioner company made certain inadvertent errors by mentioning the point of sale as Mumbai instead of Delhi and also mentioned the GST number of the receiver/ purchaser of Mumbai instead of GST number of the purchaser in Delhi. 4. Learned counsel for the petitioner submits that the aforesaid errors in the GSTR-1 return filed the petitioner came to their knowledge after the concerned purchaser notified the error to them somewhere in the month of April 2023 as they found difficulty to avail GST input tax credit. The purchaser further refused ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd there cannot be an open ended time frame for corrections/ rectifications. He submits that the time frame has been aligned with the further time provided for furnishing of audit report for the respective financial years. There is a cascading effect on the other processes and it is important to conclude the entire process in the timeline. 8. It is submitted by learned counsel for the respondents that merely by rectifying Form GSTR-1 at this stage would not automatically allow the concerned recipient tax payer to claim ITC now as the same has also become time barred in terms of Section 16 (4) of the Act. It is further pointed out that after submitting GSTR-1 by the supplier, GSTR-2A auto generates for the recipient supplier. The same becomes a basis for claiming input tax credit under the GSTR-3B. Thus, input tax credit can be availed till the date on furnishing of the return as provided under Section 39 of the Act i.e. by the month of September following the end of financial year for which the invoice or debit note pertains or the date when the relevant annual return is furnished, whichever is earlier. The correction in the corresponding GSTR-1, therefore, is permissible in terms ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it notified by the Commissioner of State tax or Commissioner of Union territory tax shall be deemed to be notified by the Commissioner. Section 37 (3) in The Central Goods and Services Tax Act, 2017 (3) Any registered person, who has furnished the details under sub-section (1) for any tax period [xxx], shall, upon discovery of any error or omission therein, rectify such error or omission in such manner as may be prescribed, and shall pay the tax and interest, if any, in case there is a short payment of tax on account of such error or omission, in the return to be furnished for such tax period: PROVIDED that no rectification of error or omission in respect of the details furnished under sub-section (1) shall be allowed after the thirtieth day of November] following the end of the financial year to which such details pertain, or furnishing of the relevant annual return, whichever is earlier: [PROVIDED FURTHER that the rectification of error or omission in respect of the details furnished under sub-section (1) shall be allowed after furnishing of the return under section 39 for the month of September, 2018 till the due date for furnishing the details under sub-section (1) for the mont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fied by the Commissioner of State tax or Union territory tax shall be deemed to be notified by the Commissioner. (7) Every registered person who is required to furnish a return under sub-section (1), other than the person referred to in the proviso thereto, or sub-section (3) or sub-section (5), shall pay to the Government the tax due as per such return not later than the last date on which he is required to furnish such return: Provided that every registered person furnishing return under the proviso to section (1) shall pay to the Government, in such form and manner, and within such time, as may be prescribed,- (a) an amount equal to the tax due taking into account inward and outward supplies of goods or services or both, input tax credit availed, tax payable and such other particulars during a month, or (b) in lieu of the amount referred to in clause (a), an amount determined in such manner and subject to such conditions and restrictions as may be prescribed.) Provided further that every registered person furnishing return under sub-section (2) shall pay to the Government the tax due taking into account turnover in the State or Union territory, inward supplies of goods or servic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n. 12. From the aforesaid provisions, it is apparent that the process as submitted by learned counsel for the Revenue is complete in itself and each step precedes the earlier step. If one of the steps is erroneous and the same is not corrected or rectified within the timeline provided under the provisions, a cascading effect would occur to the subsequent process provided under the subsequent provisions. We are satisfied from the aforesaid provisions that if a person submits an erroneous GSTR-1, and does not correct it, the subsequent GSTR-2A and GSTR-3B would also reflect the erroneous information and the consequences thereof shall follow. 13. We find that the time limitation, as provided under Section 37 (1) and 37 (3) of the Act, is linked directly and proportionately to Section 16 (4) of the Act. In terms of the aforesaid provisions, input tax credit can be availed till the due date of furnishing the return under Section 39 of the Act for the month of September following the end of the financial year to which the invoice / debit note pertains or furnishing of the annual return, whichever is earlier. The correction in the corresponding GSTR-1 is permissible in terms of the timeli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry aspect of the returns has a cascading effect. This is necessarily required to be borne in mind when considering the cases of inadvertent human errors creeping into the filing of GST returns. 16. The Bombay High Court also noticed that the Single Judge of Madras High Court in Sun Dye Chem vs Assistant Commissioner vs Assistant Commissioner (ST) and others 2020 TIOL 1858 HC MAD.GST held that the customers of the assessee should not be prejudiced from availing credit which they are otherwise legitimately entitled to. It also relied on Division Bench judgment of Orissa High Court passed in Shiva Jyoti Construction vs The Chairperson, Central Board of Excise Customs and others MANU/OR/0522/2023 wherein the Court observed that if no prejudice has been caused to the department, such error ought to be rectified. 17. In Bharti Airtel s case (supra), the Supreme Court was considering the question of similar nature. In the said case, the Bharti Airtel has erroneously deposited cash and submitted that if it was allowed to rectify Form GSTR-3B so as to avail ITC for the relevant period, amount paid by it in cash towards the OTL would get credited to its electronic cash ledger account. After ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubmitted in Form GSTR3-B for the relevant period in which the error had occurred. Any unilateral change in such return as per the present dispensation, would have cascading effect on the recipients and suppliers associated with the concerned transactions. There would be complete uncertainty and no finality could ever be attached to the self-assessment return filed electronically. We agree with the submission of the appellant that any indulgence shown contrary to the statutory mandate would not only be an illegality but in reality, would simply lead to chaotic situation and collapse of tax administration of Union, States and Union Territories. Resultantly, assessee cannot be permitted to unilaterally carry out rectification of his returns submitted electronically in Form GSTR-3B, which inevitably would affect the obligations and liabilities of other stakeholders, because of the cascading effect in their electronic records. 49. As noted earlier, the matching and correction process happens on its own as per the mechanism specified in Sections 37 and 38, after which Form GSTR3 is generated for the purposes of submission of returns; and once it is submitted, any changes thereto may have ..... X X X X Extracts X X X X X X X X Extracts X X X X
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