HC directed GST authorities not to impose demand/penalty as revised GSTR-3B was filed manually due to problem in system




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HC directed GST authorities not to impose demand/penalty as revised GSTR-3B was filed manually due to problem in system

 

GST: Where assessee’s attempt to revise its return, after obtaining credit, which was allocated to its units, could not be materialised on account of certain design limitation and it in pursuance of order of High Court filed Form GSTR-3B manually and same had been processed and notional demand had been reversed, GST Authorities were directed not to raise any demand towards penalty, interest or late filing fee against assessee

[2018] 105 taxmann.com 48 (Delhi)

HIGH COURT OF DELHI

Clix Capital Services (P.) Ltd.

v.

Union of India

  1. RAVINDRA BHAT AND PRATEEK JALAN, JJ.

W.P. (C) NO. 1486 OF 2018
C.M. APPL. NO. 6122 OF 2018

MARCH  27, 2019

Section 39 of the Central Goods and Services Tax Act, 2017 read with rule 61 of the Central Goods and Services Tax Rules, 2017/ Section 39 of the Delhi Goods and Services Tax Act, 2017 read with rule 61 of the Delhi Goods and Services Tax Rules, 2017 – Returns – Furnishing of – Assessee’s attempt to revise its return, after obtaining credit, which was allocated to its units, could not be materialised on account of certain design limitation – High Court by order dated 5-7-2018 permitted assessee to lodge its Form GSTR-3B manually – Assessee filed Form GSTR-3B manually and same had been processed and notional demand had been reversed – Whether in peculiar facts and circumstances of case, GST Authorities were to be directed not to raise any demand towards penalty, interest or late filing fee against assessee – Held, yes [Para 4][In favour of assessee]

(NR)

FACTS

■ The assessee’s attempt to revise its return, after obtaining credit, which was allocated to its units, could not be materialised on account of certain design limitation.
■ The High Court by order dated 10-12-2018 had permitted the assessee to lodge its Form GSTR-3B manually.
■ The assessee, in pursuance of the order of High Court, filed Form GSTR-3B manually and same had been processed and the notional demand in respect of Rs. 16.80 crores had been reversed.
■ The assessee submitted before the High Court that in these circumstances, given that the system problem arose on account of design limitation, the GST Authorities should not enforce any further demand, penalty, interest or late submission fee.

HELD

■ Given the peculiar facts and circumstances, the Court is of the opinion that the assessee’s argument is well founded. The GST Authorities are enjoined not to raise any demand towards penalty, interest or late filing fee. Late fee, if any, paid by the assessee, shall be refunded to it. [Para 4]

CASES REFERRED TO

Indusind Media Communications Ltd.. v. Union of India [2018] 99 taxmann.com 314 (Delhi) (para 1).

Tarun Gulati and Kishore Kunal, Advs. for the Petitioner. Vivekanand Mishra, Apar Chopra, Ms. Nidhi Mohan, Pratyaksh Sharma, Amit Bansaland Aman Rewaria, Advs. for the Respondent.

ORDER

  1. The petitioner’s attempt to revise its return, after obtaining credit, which was allocated to its units could not be materialised on account of certain design limitations. Consequentially by order dated 05.07.2018 and 10.12.2018 this court had permitted the petitioner to lodge its GSTR 3B Form manually. The court also took note (by order dated 23.01.2019) of another proceeding, Indusind Media Communications Ltd.v. Union of India [2018] 99 taxmann.com 314 (Delhi) in that matter.
  2. The court also was cognizant of the Bombay High Court decision, in the said related matter – Indusind Media Communications Ltd.case (supra) and had directed to verification of credits in respect of local areas. Accordingly, on 23.01.2019 the following directions were made:
  3. During the hearing of the present matter, the respondent submitted that the petitioner need not pay the amounts which are to be reconciled in cash and interest liability might be approved.
  4. This Court is of the opinion that the GSTR-3B form which is. Now taken on record manually should be properly verified, in coordination with the concerned Commissionerate, pending final decision and appropriate orders by the GST officials/Commissioner, on the merits of these input claims. No demand shall be imposed by the respondents towards the interest claims, which are said to be approved. In other words, the claim of the petitioners for the set-off of its credit towards the notional demand of Rs.16.80 crores shall be duly verified in accordance with law.
  5. The petitioner shall take the consequential steps as necessary to facilitate the completion of proceedings in this regard.
  6. It is submitted by learned counsel for the petitioner that further to the previous directions, the Form GSTR-3B filed manually has since been processed and the notional demand in respect of Rs.16.80 crores has been reversed. It is submitted that in these circumstances, given that the system problem arose on account of design limitation, the respondents should not enforce any further demand, penalty, interest or late submission fee.
  7. Given the peculiar facts and circumstances, this court is of the opinion that the petitioner’s argument is well founded. The respondents are enjoined not to raise any demands towards penalty, interest or late filing fee. Late fee, if any, paid by the petitioner, shall be refunded to the petitioner.
  8. In view of the statement made and the subsequent developments where the petitioner’s grievance has been resolved, no claims survive for adjudication.

The writ petition is disposed of in the aforesaid terms.

sk jain




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