Union Of India VS  Bharti Airtel Ltd

This appeal stems from a decision made on 05.05.2020 by the High Court of Delhi in the case of W.P. (C) No.6345 of 2018. In this judgment, the High Court granted the writ petition brought by respondent No.1 and interpreted paragraph 4 of Circular No. 26/26/2017-GST dated 29.12.2017, issued by the Commissioner (GST), Government of India, Ministry of Finance, Department of Revenue, Central Board of Excise and Customs, GST Policy Wing. The interpretation essentially relaxed the restrictions on rectifying Form GSTR-3B concerning periods in which errors had occurred. The High Court permitted respondent No.1 to proceed with the rectification.

The High Court directed the appellant to allow rectification of Form GSTR-3B for the period from July to September 2017, during which the error had occurred. Additionally, the appellant was instructed to verify respondent No.1’s claim within two weeks of filing the rectified form and to give effect to it once verified.This legal dispute arises from the enactment of the Central Goods and Services Tax Act, 2017, which came into effect on July 1, 2017. Notification No.10/2017 dated July 1, 2017, brought into force Rules 59, 60, and 61 of the Central Goods and Services Tax Rules, 2017, along with Forms GSTR-1, GSTR-2, GSTR-2A, GSTR-3, and GSTR-3B.In the context of the matter at hand, it’s relevant to note Notification No.17/2017-Central Tax dated July 27, 2017, which amended Rule 61 by modifying Rule 61(5) and introducing Rule 61(6). Rule 61(5) originally stated that where the time limit for furnishing details in FORM GSTR-1 under section 37 and in FORM GSTR-2 under section 38 has been extended and circumstances warrant it, a return in FORM GSTR-3B may be furnished instead of FORM GSTR-3, subject to conditions notified by the Commissioner.

The provision in question underwent significant changes through Notification No.17/2017-Central Tax. Not only was Rule 61(5) substituted, but Rule 61(6) was also introduced. The amended Rule 61(5) now empowers the Commissioner to specify, through notification, that returns shall be furnished in FORM GSTR-3B electronically via the common portal, either directly or through a Facilitation Centre, when the time limit for furnishing details in FORM GSTR-1 and FORM GSTR-2 has been extended and circumstances warrant it.

Additionally, Rule 61(6) stipulates that when a return in FORM GSTR-3B has been furnished after the due date for furnishing details in FORM GSTR-2:

(i) Part A of the return in FORM GSTR-3 shall be electronically generated based on information provided through FORM GSTR-1, FORM GSTR-2, and other liabilities of preceding tax periods.

(ii) Part B of the return shall be.

electronically generated based on the return in FORM GSTR-3B furnished for the respective tax period. Subsequently:

1. The registered person must adjust Part B of the return in FORM GSTR-3 based on any discrepancies between the returns in FORM GSTR-3B and FORM GSTR-3 and settle any tax or other liabilities accordingly.

2. If the input tax credit amount in FORM GSTR-3 exceeds that in FORM GSTR-3B, the additional amount shall be credited to the electronic credit ledger of the registered person.

Following this, Notification No.18/2017-Central Tax dated 08.08.2017 extended the deadline for filing Form GSTR-1 for July and August 2017 to 05.09.2017 and 20.09.2017, respectively. On the same day, exercising the authority under Rule 61(5), the Central Government issued Notification No.21/2017-Central Tax, specifying that returns for July and August 2017 should be furnished in Form GSTR-3B electronically via the common portal before specified dates. Specifically, the deadline for filing Form GSTR-3B for July 2017 was set as 20.08.2017, and for August 2017, it was set as 20.09.2017.

The Under Secretary to the Government of India issued another Notification, No.23/2017-Central Tax dated 17.08.2017, to extend the deadline for filing Form GSTR-3B for July 2017 for individuals choosing to file Form GST TRAN-1 by 20.08.2017 until 28.08.2017, provided certain conditions like depositing tax payable under the Act and payment of interest, if applicable, were met. Respondent No.1 submitted its return in Form GSTR-3B for July 2017 on 31.08.2017.Subsequently, the Commissioner (GST) issued Circular No.7/7/2017-GST dated 01.09.2017, addressing system-based reconciliation of information provided in Forms GSTR-1, GSTR-2, and GSTR-3B, along with the mechanism for correcting erroneous details furnished in Form GSTR-3B.In response to representations from the business community, the Under Secretary to the Government of India issued Notification No.35/2017-Central Tax dated 15.09.2017. This notification, made under Section 168 of the 2017 Act and Rule 61(5) of the 2017 Rules, among other enabling provisions, and based on the recommendations of the Goods and Services Tax Council, specified the dates for filing the return.

concerned month as per the table given therein, in Form GSTR-3B electronically, through the common portal on or before the last date specified in the corresponding entry in column (3) of the said table. The last date for the concerned English calendar month was specified as the 20th day of the succeeding English calendar month for the period between August and December 2017. Respondent No.1 filed its return in Form GSTR-3B on 20.09.2017 for the month of August 2017 and on 16.10.2017 for the month of September 2017.Furthermore, the Under Secretary to the Government once again issued Notification No.56/2017-Central Tax dated 15.11.2017, specifying the timeline for filing of return in Form GSTR-3B for the month of January, February, and March 2018 as 20th February, 20th March, and 20th April 2018 respectively.Subsequently, the Commissioner (GST) issued the impugned Circular regarding the filing of returns under GST, clarifying certain issues considered by the Central Board of Indirect Taxes and Customs to usher in uniformity in implementation across field formations. This Circular suspended the earlier Circular issued on 01.09.2017 until the system-based.

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