GSTR 2A vs GSTR3B vs GSTR9: Madras HC quashes Rejection of GST ITC claim solely on non-inclusion in GSTR-3B [Read Order]

A Single Bench of the Madras High Court has quashed the rejection of a Goods and Services Tax ( GST ) Input Tax Credit ( ITC ) claim based solely on non-inclusion of the same in GST Return - GSTR-3B.

By asserting that nil returns were erroneously and inadvertently filed in the GSTR-3B returns, the petitioner stated that he is eligible for Input Tax Credit ( ITC ) in each of the above mentioned assessment periods and that this is duly reflected in the GSTR-2A returns.

Further, the petitioner stated that GSTR-9 ( annual ) returns were filed duly reflecting the ITC claims of the petitioner. By rejecting such a claim, it is stated that the orders impugned herein were issued.

The petitioner pointed out that the petitioner had replied to the show cause notice and stated that the eligible ITC in each assessment period exceeds the tax liability. By further referring to the operative portion of the orders impugned herein, the counsel contended that the ITC claim was rejected solely on the ground that the petitioner had not claimed ITC in the GSTR-3B returns.

Accepting notice on behalf of the respondent, the ASG submitted that the petitioner should have availed of the statutory remedy and not approached this Court. He further submitted that the burden of proof is on the registered person to establish ITC eligibility. Since such burden was not discharged by the petitioner, he submitted that no interference is called for with the orders impugned herein.

The Single Bench of the Madras High Court observed that, “When the registered person asserts that he is eligible for ITC by referring to GSTR-2A and GSTR-9 returns, the assessing officer should examine whether the ITC claim is valid by examining all relevant documents, including by calling upon the registered person to provide such documents. In this case, it appears that the claim was rejected entirely on the ground that the GSTR-3B returns did not reflect the ITC claim. Therefore, interference is warranted with the orders impugned herein.”

It was thus held that, “the orders impugned herein are quashed and these matters are remanded for reconsideration. The petitioner is permitted to place all documents pertaining to its ITC claims before the assessing officer within a maximum period of two weeks from the date of  receipt of a copy of this order.”

Further, the Single Bench of Senthilkumar Ramamoorthy added that, “Upon receipt thereof, the respondent is directed to provide a reasonable opportunity to the petitioner, including a personal hearing, and thereafter issue fresh assessment orders..”

To Read the full text of the Order CLICK HERE

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