Mahalaxmi Infra Contracts Limited vs GST Council

Writ Petition — Compliance — GSTR-1 — Assessee had filed a writ petition to allow it to carry out amendment in its GSTR-1 for the month of January 2019 in order to rectify its mistake of mentioning the wrong GSTIN number. Whether such liberty can be given? Held, since the instant case does not present any additional tax impact, or loss of revenue for the State Exchequer and, in fact, such correction of relevant returns in case of the petitioner i.e., GSTR-1, GSTR-2A in case of the assessee no. 5 and 6 would allow revenue no.5 to rightly avail Input Tax Credit #ITC against tax paid under Tax Invoice number 1/2018-19 dated 17th January 2019 issued by Assessee, in the interest of justice, the assessee is given liberty. Writ Petition Allowed. Sec. 37 (3), Rule 70 & 71 GST Laws.

1. Heard learned counsel for the petitioner, Respondent No.5 ECL, Respondent no. 6 MIPL-NKAS (JV), Respondent No.8 GSTN and the Respondent State. Writ petitioner approached this Court to allow it to carry out amendment in its GSTR-1 for the month of January 2019 in order to rectify its mistake of mentioning wrong GSTIN number against the invoices raised on Respondent no.5. The GSTIN number of petitioner’s own joint venture, Respondent No.6 was inadvertently mentioned therein. Petitioner also sought a direction upon the respondent GSTN to allow respondent No.5 purchaser of the petitioner to avail ITC pertaining to the said transaction.

2. Petitioner is a company bearing GSTIN number 20AAGCM4615E1Z1 engaged in business of mining. It also undertakes transportation of goods for central government undertakings, including the Respondent no.5 Eastern Coalfields Limited, Central Coal Fields Limited etc. within the State of Jharkhand. In the year 2018 petitioner’s company was engaged by respondent no.5 bearing GSTIN No. 20AAACE7590E3ZX for providing services in relation to removal and re-handling of overburden from Dahernangi OC patch of Rajmahal Area. While filing its return in Form GSTR 1 for January 2019 in March 2019 i.e., within the time prescribed, according to the petitioner an inadvertent error was committed in the GSTIN of Eastern Coalfields Ltd. (GSTIN No. 20AAACE7590E3ZX ) as petitioner’s employee quoted the GSTIN of one MIPL-NKAS (JV) (GSTIN No.20AAEAM0162G1Z9). Petitioner approach this Court as this mistake was realized by it only in June 2021 during final settlement of accounts with Respondent No.5, Eastern Coalfields Limited. When the matter was taken up on 23rd June 2022, upon hearing the learned counsel for the parties including GST Council, State of Jharkhand and Respondent no.5, this Court encapsulated the grievance of the petitioner and the legal issues raised for consideration of this court. The order dated 23.06.2022 is extracted here under: 

3.By the instant order, MIPL-NKAS (JV) was impleaded as Respondent number 6 and asked to file counter affidavit, specifically stating whether they have availed ITC wrongly reflected in their GSTR- 2A of March 2019 of the value indicated here in above. It was also asked to indicate as to whether they have been subjected to any show-cause for suppression of purchases by the tax authorities. Respondent No.6 appeared on notice and filed a counter affidavit. The stand of the Respondent No.6 as reflected in its counter affidavit are incorporated in the order dated 20 th July 2022. It denied having availed such ITC wrongly reflected in its GSTR-2A. By the said order, upon consideration of the stand of the Respondent No.6 also, this court came to the opinion that all the three parties i.e., Petitioner, Respondent No.5 and 6 should appear before the Joint Commissioner, Administration ( Head Quarters), with the relevant records including their books of accounts and returns of the said period. The Joint Commissioner Administration ( Head Quarters) was therefore impleaded as Respondent No.7 and directed to carry out this inquiry and undertake due diligence with the concerned parties within a period of three weeks. Parties were directed to cooperate and produce all other relevant records called for by the Joint Commissioner Administration (Head Quarters) for the aforesaid purpose. The order dated 20.07.2022 is also extracted here under for easy reference:

4. On consideration of the report it appeared that there was no mis utilization of ITC by any of the parties. The issue remained essentially a matter of correction in the returns. Since such correction could be carried out through GSTN portal, this Court thought it proper to implead GSTN through its chairman as Respondent No.8. Learned counsel for the Respondent No.1 Goods and Service Tax Council Mr. Amit Kumar duly accepted notice on behalf of GSTN and undertook to obtain instruction on this issue. GSTN has filed an affidavit yesterday. Learned counsel for the GSTN has submitted that the details filed in GSTR-1 can be edited and saved multiple times by taxpayer before the same is submitted and signed digitally. Further the GST portal allows taxpayer to preview the GSTR-1 before submitting the same to verify the added records. Petitioner has acknowledged ticking the acknowledgment check box that they have reviewed the details of preview and information furnish is correct and they were aware that no changes can be made after submission of GSTR-1. It is only thereafter that the taxpayer ticks the button whereby submission of GSTR-1 is made to the GSTN Portal. There is a responsibility cast upon the supplier to verify the GST registrations to avoid showing of credit in GSTR- A of wrong GSTIN. Learned counsel for the respondent GSTN has referred to Section 37 (3) of the CGST Act which provides that a registered person who has furnished the details under subsection (1) for any tax period and which have remained unmatched under Section 42 or section 43, shall , upon discovery of any error or omission there in, rectify such error or omission in such manner as may be prescribed and shall pay the tax and interest, if any, in case there is a short payment of tax on account of such error or omission, in the return to be furnished for such tax period. Learned counsel for the respondent GSTN further submits that proviso to Section 37(3) makes it clear that no rectification of error or omission in respect of the details furnished under sub section (1) shall be allowed after furnishing of the return under Section 39 for the month of September, following the end of the financial year to which the such details pertain, or furnishing of the relevant annual return, whichever is earlier. It is submitted that the system allows amendment of all records declared in GSTR-1 as per the time line mentioned under Section 37(3) of the CGST Act 2017. The petitioner did not exercise the option to amend / rectify the mistake by making such correction in subsequent GSTR-1 return up to September 2019. The original invoice in this case is reported in financial year 2018-19. Therefore no amendment is allowed of invoices pertaining to FY 2018-19 after the due date for furnishing the details under Section 37(1) of the CGST / SGST act. Learned counsel for the Respondent GSTN has, in particular referred to the stand of the respondent GSTN as contained in para 6 of the counter affidavit. GSTN has stated that the portal has been designed in accordance with the provisions of CGST / SGST Act and Rules made thereunder and there are no arbitrary restrictions imposed on the portal. Allowing amendments in GSTR-1 at this belated stage shall carve out an exception not only raising potential technical issues in the system, but also leading to complications in settlement of payments across the state governments. In substance GSTN has conveyed that correction of GSTR-1 return by the petitioner at this stage could be barred under Section 37(3) of the act, and it may create difficulties in technical issues in working of the GSTN Portal.

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Jharkhand High Court 

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