2026-VIL-293-GAU
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SGST High Court Cases

GST - Mismatch in GSTR-1 vs. GSTR-3B – Rectification of Bona Fide Human Error – Whether excess liability shown in GSTR-1 due to clerical error is an admitted liability recoverable without granting an opportunity to the Petitioner to explain on the basis of the Explanation to Section 75(12) of the CGST Act which was inserted w.e.f. 01.01.2022, held that any excess liability shown in the GSTR-1 vis-à-vis is an admitted liability and recoverable from the taxpayer - HELD - There is an admitted mismatch between the GSTR-1 Return filed by the Petitioner with that of the GSTR-3B submitted by the Petitioner. The mismatch pertains to invoices wherein in the GSTR-1 Return the Petitioner had shown that the tax component was 18% which as per the Petitioner was 12%. Additionally, there was a wrong mention of the Credit Note - The authority failed to follow the procedure under Rule 88C of the CGST Rules, 2017 which mandates an intimation and an opportunity for the taxpayer to explain such differences before recovery. The mismatch was not brought to the attention of the Petitioner as required under Rule 88C and the Respondent without affording the Petitioner the opportunity to explain the mismatch between the GSTR-1 and GSTR-3B had directly imposed the tax liability on the basis of the GSTR-1 Return along with interest - The Petitioner should be granted an opportunity to explain the mismatch between the GSTR-1 and GSTR-3B by placing necessary materials - The State can only recover tax at the rate imposed by statute on the goods or services; if the actual tax charged was 12%, the recovery cannot be @ 18% based solely on a reporting error - The matter is remanded to allow the petitioner an opportunity to explain the mismatch with supporting materials – The impugned order is set aside and the petition is disposed of - Time Limit for availment Input Tax Credit – Impact of Finance (No. 2) Act, 2024 – Whether ITC can be denied for returns filed after the initial due date for Financial Year 2018-19 – HELD - The denial of Input Tax Credit on the grounds of delayed filing is no longer sustainable in view of the retrospective insertion of Section 16(5). This new provision statutorily overrides the restrictions in sub-section (4) for the Financial Years 2017-18, 2018-19, 2019-20, and 2020-21. Under Section 16(5), a registered person is entitled to take ITC in any return filed up to the 30th day of November, 2021. As the return for March 2019 was submitted on 13.03.2021, it falls well within the newly stipulated period. Consequently, the petitioner is entitled to the credit, and the previous order denying the same for being beyond the due date of September 2019 is interfered with and quashed – Writ Petition allowed
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