GST Demand on ITR-26AS, GSTR-2A Mismatches & ITC Reversal on Credit Notes: Madras HC directs to approach Appellate Forum [Read Order]

Regarding the GST (Goods and Services Tax) demand raised due to mismatches in ITR Form 26AS, discrepancies in Input Tax Credit (ITC) reflected in GST Returns 2A (GSTR-2A), and ITC reversals stemming from credit notes received, the Madras High Court has directed the petitioner to approach the designated appellate forum, citing that an effective statutory remedy is available there.

A writ petition filed to challenge an assessment order dated 20.09.2024, issued under Section 74 of the Tamil Nadu Goods and Services Tax (TNGST) Act, 2017, for the assessment year 2022–2023. With the consent of both parties, the court took up the matter for final disposal at the admission stage itself.

Confused by Complex GST Provisions and Legal Disputes in Real Estate? Get Clarity and Practical Solutions from Industry Experts- Enroll Now

The petitioner sought relief against the demand raised on account of mismatches in ITR Form 26AS, Input Tax Credit (ITC) reflected in GSTR-2A, and ITC reversals arising from credit notes received.

Mr. N.Sudalai Muthu, the petitioner's counsel argued that the assessment order was fundamentally flawed, asserting that the mismatches and reversals had been wrongly interpreted, making the consequential interest and the imposition of a 100% penalty excessive and unwarranted. The petitioner prayed for the quashing of the impugned assessment order.

On the other hand, the Government Advocate, Mr. J.K. Jayaselan, informed the court that an inspection had been conducted from 11.10.2023 to 13.10.2023, which revealed several discrepancies. Following this, an intimation notice was electronically issued to the petitioner on 18.03.2024 under Section 74(5) of the Act, and after considering the petitioner’s reply, a show cause notice was served on 16.04.2024.

He submitted that the petitioner had an alternative statutory remedy by way of an appeal before the Appellate Deputy Commissioner (ST), GST Appeal, under Section 107 of the TNGST Act, 2017, but instead of pursuing this appellate route, the petitioner directly approached the High Court.

The bench of Vivek Kumar Singh of the Madras High Court declined to interfere with the assessment order at the writ stage. The court disposed of the writ petition, granting the petitioner liberty to approach the appellate authority and raise all the grounds presented in the writ petition before the appellate forum.

The court further directed that if the petitioner files an appeal within two weeks from the date of receipt of the order, the appellate authority should entertain the appeal and dispose of it in accordance with the law within three months. The court made no order as to costs and closed the connected miscellaneous petition.

To Read the full text of the Order CLICK HERE

Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates