Goods and Services Tax SC disallowed Bharti from taking INR 923 Cr GST refund by changing GSTR Return

SC disallowed Bharti from taking INR 923 Cr GST refund by changing GSTR Return

SC disallowed Bharti from taking INR 923 Cr GST refund by changing GSTR Return

Supreme Court Bench Disallows Bharti Airtel from seeking Rs. 923 crore GST Refund by Rectifying Return

Facts- 

The Respondent was having issues filling GSTR Form 3B due to several glitches in the Online GST Portal, according the brief facts of the case. Despite these issues, the Respondent filed its GST returns for the months of July to September 2017 with an excess of Rs 923 crores, for which they have claimed a refund.

Honorable Supreme Court Bench Disallows Bharti Airtel from seeking Rs. 923 crore GST Refund by Rectifying Return

  • GST regulations has permits rectification of omissions and errors only at initial stages of GSTR -1 Forms & GSTR­3, but it must be in the prescribed manner.
  • Bharti Airtel had requested that, due to non-­operability of Form GSTR­2A at the relevant time (July to September 2017), it had been denied of access to the Credit Ledger. GST dept claimed that the Bharti Airtel has under reported ITC.
  • In spite of an express GST mechanism which provided by under Section 39(9) read along with Rule 61 of CGST Act 2017, it was not open to the Honorable High Court to proceed on the assumption that the only remedy that can enable the assessee to enjoy the advantage of the seamless utilisation of the input tax credit was by way of rectification of its return submitted in Form GSTR­3B for relevant time period in which the error had arise.
  • In July-2020, moved to the Honorable Supreme Court to challenging the Delhi high court Order.
  • It further stated that Bharti Airtel was not denied the option to remedy omissions or wrong information in the return to be filed for the month or quarter in which the omission or incorrect information was discovered. “As a result, it is not a matter of ITC denial per se. If anything, it's merely a deferral of taking use of the ITC. Input Tax Credit amount is saved in the electronic credit ledger and can be used in future returns, including the next financial year."
  • Bharti Airtel wanted to correct an issue in October 2018 by requesting a refund of Rs 923 crore in "excess tax" because it had under-reported its credit claim. Unfortunately, the assessee was unable to do so since the govt's circular in Dec 2017 disallowed companies from submitting rectifications under the prior circular in September 2017.
  • The Supreme Court Allowed the Appellant’s plea against the Honorable  Delhi HC Order that who had directed to issue the GST Tax refund to the Respondent by rectifying its GST return for July, 2017 to September 2017.

Honorable Supreme Court held in the matter of Union of India v. Bharti Airtel Ltd. and Others that...despite an express mechanism provided by Section 39(9) read with Rule 61, it was not open to the Delhi high court Order to proceed on the assumption that the only remedy that can enable the assessee to enjoy the benefit of the seamless utilisation of the Input Tax Credit was by way of rectification of its return submitted in Form GSTR­3B for the relevant period in which the error had occurred.

CBIC : Detailed instruction on Post GST audit & review of GST Refunds

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