HP HC: GSTR-9 and GSTR-9C Filing Before Amnesty Notification Date Can’t Be Denied a Late Fee Waiver

Taxpayers who filed their annual return (GSTR-9) and reconciliation statement (GSTR-9C) before the amnesty notification date can still avail of the late fee waiver benefit, the Himachal Pradesh High Court ruled.

It was noted by the bench of Acting Chief Justice Tarlok Singh Chauhan and Justice Satyen Vaidya that the objective of the government for the notification was not to penalize the taxpayers but to motivate the returns filing for the mentioned assessment years.

The court acknowledged the same and ruled that the amnesty scheme benefit must extend to the applicant who has furnished the return belatedly dated 13.03.2023 before the cut-off date specified in the notification.

The petition was submitted via a pharmaceutical company named R T Pharma, a registered company under GST, which faced financial distress and submitted its returns belatedly dated March 13, 2023, before the amnesty notification of the government on March 31, 2023 (Notification No. 07/2023).

A Show cause notice has been furnished to the applicant dated August 22, 2023, levying a late fee of Rs 12,71,754 as the authorities claim that the amnesty scheme was merely applicable to the filed returns between April 1, 2023, and June 30, 2023. It was ruled by the applicant that the amnesty intended to motivate tax compliance and must extend to those who furnished the returns before the notification date.

The petitioner relied on a similar ruling by the Kerala High Court in Anishia Chandrakanth v. Superintendent, Central Tax and Central Excise, where it was noted that “When the Government itself has waived late fee under the aforesaid two notifications Nos. 7/2003 dated 31.03.2023 and 25/2023 dated 07.07.2023 in excess of Rs. 10,000/-, in case of non-fliers there appears to be no justification in continuing with the notices for non-payment of late fee for belated GSTR 9C, that too filed by the taxpayers before 01.04.2023, the date on which one-time amnesty commences.”

The Kerala high court in the aforesaid decision discovered it unfair and unsustainable to the extent it asked to collect the late fee for the delay in GSTR-9C filing. But it cited that the applicant shall not be qualified to claim the refund of the late fee which has been filed by them before over and above Rs 10,000.

It was claimed by the respondents that the amnesty scheme under Notification No. 7/2023, on 31.03.2023, was just applicable to taxpayers who failed to submit their returns within the specified amnesty period.

It was claimed by them that in this case the due date to file the GST return had lapsed on 07.02.2020, and the applicant furnished the return dated 13.03.2023 before the amnesty period (01.04.2023 to 30.06.2023) started. Hence it was asserted by them that no eligibility would be there for the applicant towards the notification benefits.

It was marked by the court that it shall be unfair to refuse the applicant the benefit only due to the return was submitted before the issuance of the amnesty notification dated 31.03.2023, which gives relief solely to those filing between 01.04.2023 and 30.06.2023.

The court, acknowledging the wider objective of the notification, ruled in favour of the applicant. Therefore, it set aside the impugned order dated 30.11.2023 and the Show Cause Notices (SCN) on 22.08.2023 issued u/s 74 of the Act.

The case was remanded to the third respondent asking them to pass a fresh order on merit while extending the advantage of the notification as per the statute. Also, the court stated that the revised order is to be issued immediately within 3 months from the receipt of the ruling.