Chartered Accountant
Bookmark and Share
click here to subscribe our newsletter
 
 
Corporate News *  Service tax penalty can’t survive when assessee acted on dept.’s own view of non-taxability: Delhi High Court. *  GST section 74 extended limitation questionable when form 26AS mismatch was already known: Karnataka High Court grants interim relief. *  CGST demand prima facie impermissible after state GST settlement under section 128A: Bombay High Court. *  Supreme Court asks GSTAT to sympathetically consider delay as taxpayers pursued remedy before wrong forum. *  Supreme Court stays Tripura High Court ruling protecting genuine buyers from ITC denial over supplier’s GST default. *  Diary entries alone can’t prove clandestine removal of goods: CESTAT quashes excise penalty on steel trader. *  Customs could investigate preferential tariff claims even before sec. 28DA: Delhi High Court. *  Customs dept. relied on fake AI generated case laws: supreme court quashes Rs. 425.28 crore penalty. *  No GST exemption in affiliation and annual registration charges for admission or conduct Of examinations: GSTAT. *  Mere invoices, cheque payments insufficient to establish genuine movement of goods: GSTAT restores Rs. 43.44 lakh ITC demand. *  Consolidated GST show cause notice covering multiple financial years is not without jurisdiction: Delhi High Court. *  Construction of independent houses on separate plots not taxable as ‘Residential Complex’ without common facilities: CESTAT. *  GST penalty exceeding statutory maximum unsustainable; Allahabad High Court quashes ? 50,000/- penalty after taxpayer filed return and paid late fee. *  GST order against standard chartered bank passed without hearing set aside by Bombay High Court. *  Retracted statements can’t be relied upon without cross-examination: CESTAT quashes gold confiscation. *  Burden to prove misclassification lies on customs department: CESTAT. *  CESTAT quashes Rs. 98 lakh excise demand on clearance of used refractory brick scrap. *  Service tax demand on irrigation works quashed: Karnataka High Court rules sale of goods component not taxable as service. *  GSTAT restores tax and penalty for transporting iron scrap without E-way bill citing intent to evade tax. *  Madras High Court stays GST recovery from directors without opportunity to show cause under section 89. *  Madras high court stays GST recovery notice against directors; finds prima facie case on applicability of section 79(1)(c). *  Procedural lapses can’t justify harsh punishment without serious customs breach: CESTAT quashes customs broker licence revocation. *  Service tax payable on land leasing and sports complex charges: CESTAT. *  Settled customs dispute can’t be reopened through Article 226 challenge to interest liability: Delhi High Court. *  Mere facilitation of customs clearance can’t establish knowledge of smuggling: Madras High Court. *  GST registration cancellation stayed: Allahabad High Court questions 99% ITC utilisation cap under rule 86B. *  Composition scheme lapses automatically on crossing Rs. 1.5 crore turnover: GSTAT. *  Gujarat High Court quashes GST cancellation orders after officer relied on non-existent AI-generated case laws. *  Importers liable for customs duty benefits availed through manipulated scrips: Delhi High Court. *  Procedural E-way bill lapse alone can’t justify penalty where genuine transaction and absence of tax evasion are established: GSTAT.
Subject News *  Documentary evidence dominates probe, further custody unwarranted: mumbai court grants bail in Rs. 22.44 crore customs duty evasion case. *  Business premises can’t remain sealed for non-participation in GST search: Allahabad High Court. *  GST pre-deposit must be refunded proportionately when taxpayer partly succeeds in appeal: Bombay High Court. *  Supreme Court grants 30 days to file GST appeal; keeps pre-deposit issue open due to deposit in parallel CGST proceedings. *  GST demand can’t exceed amount proposed in SCN: Allahabad High Court quashes Rs. 20.47 Crore order. *  Hundreds-of-crores GST demand and heavy 10% pre-deposit no ground to bypass statutory appeal: Punjab & Haryana High Court. *  Delhi High Court refuses to entertain challenge to gold confiscation due to statutory appeal remedy and unexplained delay. *  Procedural error in customs broker licence inquiry can be rectified through remand: Delhi High Court. *  GSTR-2A mismatch alone can’t justify ITC denial without invoice-wise verification; personal hearing mandatory: GSTAT. *  GST order passed without uploading personal hearing notices violates sec. 75(4): Allahabad High Court. *  TAX EVASION - Sec. 74 GST SCN quashed for not spelling out fraud, wilful misstatement or suppression: Allahabad High Court. *  STPI’s SOFTEX certification and NoC charges taxable as business support services: CESTAT. *  Suspicion can’t replace proof: CESTAT quashes penalty in alleged gold-smuggling operation. *   Limitation runs from communication of order: Madras High Court upholds rejection of delayed GST Appeals. *  Rajasthan High Court quashes GST demand over unsigned show cause notice. *  ITC recovery upheld where supplier failed to deposit GST: Rajasthan High Court. *  Customs commissioner’s empowered to make port trust liable for duty on pilfered goods: Supreme Court. *  Rectification proceedings can’t be used to challenge an uncontested GST assessment through a writ petition: Andhra Pradesh HC. *  GST proceedings against deceased proprietor unsustainable without notice to legal heir: GSTAT. *  Mere availment of ineligible self-assessed ITC doesn’t amount to suppression without evidence of fraud or wilful misstatement: GSTAT. *  Disposal of mining overburden by entity authorised by mining lease holder constitutes taxable service: CESTAT. *  Toll plaza data not mandatory for ITC refund: GSTAT. *  Disputed GST fraud allegations require investigation: Punjab and Haryana High Court makes interim bail absolute in alleged fraud and GST fraud case. *  Non-manufacturer contractor liable to deposit excess excise duty collected from buyer: CESTAT. *  GST order can’t reject taxpayer’s reply as “not satisfactory” without reasons: Madhya Pradesh High Court. *  Uncorroborated statements can’t establish alleged diversion of duty-free goods: CESTAT. *  Erection services were not liable to service tax prior to 10th september 2004: CESTAT. *  Sec. 74 GST notice must spell out statutory ingredients for invoking extended tax demand proceedings: Allahabad High Court. *  No jurisdictional bar under section 6(2)(b) in parallel CGST SGST proceedings: Delhi High Court refuses to bypass GST appeal remedy. *  Madras High Court remits GST demand for fresh adjudication after taxpayer claims it was unaware of SCN following business closure.  

Comments

Print   |    |  Comment

GST Update No 156 on ITC cannot be denied due to technical issues

GST Update No 156 on ITC cannot be denied due to technical issues
The process of digitalization picked up steam in India many years ago with the introduction of digital payments. Since then, India witnessed substantial digital transformation in business. The most revolutionary amongst them is digitalization in indirect tax regime. With the advent of GST w.e.f. 01st July 2017, the whole regime went under a major radical shift. The step of moving towards digitalization and paperless environment was no doubt an initiative towards ease of doing business. However, since the coin has its other side also, there were hurdles of different kinds as well. One such issue faced by taxpayer is related to technical glitches faced in the process of claiming input tax credit. The issue travelled upto Gujarat High Court in the case of EZZY ELECTRICALS VERSUS STATE OF GUJARAT. The conclusion arrived at by the Hon’ble Gujarat High Court is the subject matter of discussion of our present update. The petitioner is a proprietary concern and a small size taxpayer eligible for composition scheme u/s 10 of CGST Act, 2017. The applicant was registered under composition scheme till 31.03.2018 and decided to opt out from composition scheme w.e.f. 01.04.2018 by filing GST CMP-04 on 31.03.2018. Once the person ceases to be a composition taxpayer, he is entitled to claim Input Credit as per Section 18(1)(c) of CGST Act, 2017 by filing GST ITC-01 within a period of 30 days from date of becoming eligible to avail input tax credit. The petitioner contended that he was not able to operate GST portal due to technical glitches while filing form ITC-01 and an error report was generated on the portal. A screenshot in this regard was also submitted to the department. The petitioner further informed that the correspondences were being made by the department regarding the issue since 24.09.2018, however, no further action was taken by department in this regard. The Counsel of the Department argued that GSTN was examined as per details submitted by the petitioner regarding technical glitches. However, it was observed and concluded that there were no technical glitches. On the contrary, it was observed that petitioner used “wrong offline tool” for filing ITC-01 having version number 2.2.3 which was last updated on 10.04.2018. However, the current version of ITC-01 offline tool on GST portal is ITC_offline_v1.0 released on 12.01.2018. It is pertinent to mention that numbering of versions of offline tool is always incremental on GST portal. Since the current version is v1.0, the previous version cannot be greater than v1.0. As per the attached screenshots, offline tool used by petitioner was 2.2.3. Consequently, this represents that petitioner was using wrong utility for filing ITC-01. The Court held that even if contention of department is considered, can it be concluded that all the doors are closed for the taxpayer or is there some scope still left for the authority to permit the petitioner to take refund of input tax credit amounting to Rs. 5 Lakhs. Directions were given to department to find out some way so that refund can be sanctioned to assessee concerned. The department submitted that inquiry was made with E.D.P. Cell Gujarat regarding the subject matter. The Cell asked to inform the same to GSTN but nothing was processed further. The Court stated that even if it was fault of taxpayer i.e. wrong offline tool was being used to file ITC-01, refund should not be denied to him merely on the basis of technical glitch. The department should resolve the controversy and find any way out to settle the matter. The submissions of petitioner were considered wherein it was held that if department would have told the discrepancy to the petitioner on an earlier date, discrepancy could have been resolved. The court directed department to do the needful so that GST ITC-01 can be uploaded by petitioner and refund can be sanctioned at the earliest possible. The above judgment is a favoring judgment for the business houses which substantiates the fact that input credit is a vested right of the taxpayer which cannot be denied merely because of technical errors on the common portal. There are plethora of judgments by various courts wherein same view has been taken that procedural grounds can not supersede the provisions of legislations. In line of those judgments recently Hon’ble Kerala High Court in the matter of ST. JOSEPH TEA COMPANY LTD. V/S STATE TAX OFFICER held that ITC cannot be denied only on the ground that the transaction is not reflected in GSTR-2A. Time and again there are many more petitions in pipeline which will be goingto consume time, money and energy of both Government and assessees for denial of benefit on account of procedural lapses.
Department News


Query

 
PRADEEP JAIN, F.C.A.

Head Office : -

Address :
"SUGYAN", H - 29, SHASTRI NAGAR, JODHPUR (RAJ.) - 342003

Phone No. :
0291 - 2439496, 0291 - 3258496

Mobile No. :
09314722236

Fax No. :0291 - 2439496


Branch Office : -

Address:
1008, 10th FLOOR, SUKH SAGAR COMPLEX,
NEAR FORTUNE LANDMARK HOTEL, USMANPURA,
ASHRAM ROAD, AHMEDABAD-380013

Phone No. :
079-32999496, 27560043

Mobile No. :
093777659496, 09377649496

E-mail :pradeep@capradeepjain.com