Madras High Court: Deemed Reconciling the Differences in GSTR 3B and GSTR 2A/2B for ITC claim

The Goods and Services Tax ( GST ) Assessment order is quashed by the Madras High Court asking for the tax liability stating the discrepancy indicated in GSTR-3B and GSTR 2A/2B with a condition directing the applicant to remit 10% of disputed tax liability.

The GST assessment order is contested by the Petitioner Subh Sri Agencies on 04.07.2023. The petitioner had obtained a SCN for the inconsistencies between their GSTR 3B returns and the GSTR 2B statement. Despite the applicant explaining the difference in Input Tax Credit claims on customs duty, under the contested order the tax demand was confirmed.

The counsel of the applicant outlined the 17.03.2023 response, repeating the explanation for the customs duty Input Tax Credit, and claimed that the same was not duly regarded. The petitioner in a bid to pursue remedy, expressed willingness to remit 10% of the disputed tax demand.

Responding on behalf of the respondent, Mr T.N.C. Kaushik, Additional Government Pleader, recognized the impugned order issuance and claimed that the period for filing a petition had lapsed. However, he witnessed that the reason the applicant furnished dated 17.03.2023, highlighted the significance of the ITC clarification.

Due to the alleged lack of pertinent documents, the impugned order violated the applicant’s explanation, a bench of Justice Senthilkumar Ramamoorthy witnessed. But, acknowledging the necessity for fairness, on the condition that the petitioner remits 10% of the disputed tax demand within two weeks, the court quashed the order.

The applicant was given a chance to submit the required documents pertinent to the ITC claim. Upon receipt and verification of these documents, the respondent was asked to furnish a reasonable chance for the applicant to be heard, followed by the issuance of a fresh order within 2 months.