Sun Dye Chem VS The Assistant Commissioner

The petitioner, a partnership firm registered under the Tamil Nadu Goods and Service Tax Act, 2017, regularly files returns reflecting its turnover and tax liability, taking into account Input Tax Credit (ITC) against output tax liability. The ITC claimed encompasses Central (CGST), State (SGST), and Intra-state (IGST) components.

For the period from August 2017 to December 2017, the petitioner filed monthly returns via the GST portal using Form GSTR-3B, accompanied by annexures in Form GSTR-1 detailing the total credit for transactions involving CGST, SGST, and IGST. However, an inadvertent error occurred in reporting the credit in Form GSTR-1, where outward supplies were mistakenly categorized as inter-state sales instead of Intra-state sales, resulting in CGST and SGST credits being reflected under the IGST column.

This error was brought to the petitioner’s attention by its customers, who faced difficulties in availing the tax credit due to the misclassification. The petitioner subsequently submitted a request to amend Form GSTR-1 to rectify the error. However, this request was rejected on August 12, 2019, citing the absence of provisions to grant such amendments, especially after March 31, 2019.

The petitioner’s case underscores the challenges businesses face in rectifying inadvertent errors in GST filings and the limitations imposed by statutory provisions regarding the timeframe for seeking amendments.

The case involves a partnership firm registered under the Tamil Nadu Goods and Service Tax Act, 2017 (TNGST Act), which regularly files returns and computes tax payable after setting off Input Tax Credit (ITC) against output tax liability. The firm filed monthly returns from August 2017 to December 2017 via the GST portal in Form GSTR-3B, accompanied by annexures in Form GSTR-1 reflecting total credit for transactions including Central (CGST), State (SGST), and Intra-state (IGST) taxes.

However, an inadvertent error occurred in reporting the credit in Form GSTR-1 where Intra-state sales were mistakenly labeled as Inter-state sales, leading to CGST and SGST credits being reflected in the IGST column. The petitioner firm became aware of this error when its customers notified them, highlighting the difficulty in availing the credit.

The firm requested an amendment of Form GSTR-1 to rectify the error, but the request was rejected on August 12, 2019, citing the absence of a provision to grant such amendments after March 31, 2019, as per Notification 71/2018, which extended the deadline for submitting amended GSTR-1 forms for the 2017-18 period. Consequently, the firm was unable to correct the error.

In response, the petitioner filed a writ petition seeking a mandamus directing the Assistant Commissioner (ST)/R1 to allow correction of Form GSTR-1 for the period August 2017 to December 2017 and redistribute the credit from the IGST column to the CGST and SGST fields.

The respondents, in their counter, referred to Sections 37, 38, and 39 of the TNGST Act regarding the furnishing of details of outward and inward supply and filing returns, arguing that the time for amending outward supply details was only extended until March 31, 2019. They stated that the petitioner approached the Officer only on August 16, 2019, seeking rectification for errors occurring between October and December 2017. Due to the absence of an enabling provision, the officer couldn’t grant the relief sought. Additionally, any amendment to statutory timelines could only be made by the Government upon recommendation of the GST Council as per Section 164 of the Act.

Overall, the case revolves around the petitioner’s request to correct a filing error in their GST returns, which was initially denied due to statutory limitations on amendment timelines, leading to the petitioner seeking relief through a writ petition.

The petitioner, a partnership firm registered under the Tamil Nadu Goods and Service Tax Act, 2017, regularly files returns, computing tax liabilities after setting off Input Tax Credit (ITC). However, an error occurred in their monthly returns filed from August 2017 to December 2017, where the ITC claimed was incorrectly reported under the wrong tax columns, affecting their customers’ ability to claim credits.

The petitioner attempted to rectify this error by requesting an amendment to Form GSTR-1, but it was rejected citing a lack of provision for such amendments after March 31, 2019. Consequently, the petitioner filed a writ petition seeking permission to correct the Form GSTR-1 for the specified period and redistribute the credit to the correct columns.

In response, the respondents argued that the time for amending details of outward supplies had expired, and any amendment to timelines could only be made by the government upon the recommendation of the GST Council.

The court reviewed the relevant sections of the Act, particularly Section 37, which outlines the procedure for furnishing details of outward supplies. It noted the provisions allowing for rectification of errors or omissions in furnished details, emphasizing the obligation to rectify errors upon discovery.

Ultimately, the court considered the petitioner’s plea for rectification in light of the statutory provisions and arguments presented by both parties.

Download PDF:

For Reference Visit:

Read Another Case Law:

GST Case Law: