In a major setback to Bharti Airtel, the Supreme Court allowed the GST refund worth Rs. 923 Crores.
In May 2020, a two-judge bench of the Delhi High Court allowed Bharti Airtel to seek GST refunds and also directed the government to verify the excess GST claim. The case pertains to underreporting of input tax credit in the GST summary return form, GSTR 3B, during those three months in 2017 due to absence of the purchase-related return form during the transition period. The operator argued that in the absence of the statutory forms GSTR 2 and 3, the summary return form was introduced. It does not allow validation before uploading. In the absence of such validation, chances of incorrect details being uploaded could not be eliminated.
The Delhi High Court said, “Indisputably, if the statutorily prescribed returns, GSTR-2 and GSTR-3 had been operationalised by the Centre, the petitioner would have known the correct input tax credit amount available to it in the relevant period, and could have discharged its liability through the tax credit.”
In July 2020, the Centre moved the Supreme Court challenging the Delhi HC order of grant of refund.
While authorities claimed Bharti Airtel had under-reported input tax credit from July to September 2017, the telco said it had paid excess tax of Rs 9.23 billion on inputs based on estimates since the GSTR-2A form was not operational during the error period.
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