Kerala HC Clarifies Retrospective Application of Extended GST Return Filing Deadline in ITC Cases [Read Order]
It was clarified that the time limit for furnishing the return for the month of September should be treated as November 30th in each financial year with effect from 01.07.2017, for petitioners who had filed their returns by that date
Kerala HC
Kerala HC
The Kerala High Court has disposed of a batch of writ petitions related to Goods and Services Tax (GST) Input Tax Credit (ITC), granting significant relief to assessees by allowing them to claim benefits of specific circulars and retrospectively applying an extended deadline for filing returns.
The batch of writ petitions was filed by various assessees against the State of Kerala, the Commissioner of Kerala State GST, and the Union of India. The petitioners fell into three categories: those who had remitted GST but it was not reflected in their GSTR returns for technical reasons; those who had received goods/services with valid invoices but whose suppliers had not remitted the GST; and those who had invoices but no clear proof of payment of the tax.
The petitioners were aggrieved by the rejection of their ITC claims, which they argued were legitimate but were being denied due to procedural and technical difficulties faced during the initial rollout of the GST regime. They contended that the initial system was not fully equipped to handle the complexities, leading to genuine claims being unfairly rejected.
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A single bench comprising Justice Dinesh Kumar Singh, relying on its earlier comprehensive judgment dated 04.06.2024 in W.P.(C) Nos.31559/2019, analyzed the issues. The court noted that the government had acknowledged the difficulties in the initial GST rollout.
To resolve bona fide claims, the court referred to Circular No.183/15/2022-GST (dated 27.12.2022) and Circular No.193/05/2023-GST (dated 17.07.2023), which provide a mechanism for availing ITC in specific scenarios upon submitting proof of payment to the government by the supplier.
The court granted the petitioners a final liberty of thirty days to approach the appropriate GST authority to claim the benefits of these circulars, if applicable. Furthermore, the court addressed a crucial issue regarding the deadline for filing GST returns.
It held that the amendment to Section 39 by the Finance Act 2022, which extended the due date for the September return from September 30th to November 30th, was a procedural amendment to ease initial difficulties. The court ruled that this amendment should be given retrospective effect from 01.07.2017.
Comprehensive Guide of Law and Procedure for Filing of Income Tax Appeals, Click Here
Consequently, for the period from 01.07.2017 to 30.11.2022, if a dealer filed the September return by November 30th and had made an ITC claim before that date, their claim should be processed. The court rejected the challenge to the constitutional validity of Sections 16(2)(c) and 16(4) of the CGST/SGST Act.
Accordingly, the batch of writ petitions was disposed of by adopting the reasoning and conclusions of the earlier judgment. The court directed that the petitioners who could claim the benefit of the two circulars should make their claim within one month.
It was clarified that the time limit for furnishing the return for the month of September should be treated as November 30th in each financial year with effect from 01.07.2017, for petitioners who had filed their returns by that date. All interlocutory applications regarding interim matters were closed.
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