On Wednesday, 4 November, the Goods and Services Tax Appellate Tribunal (GSTAT), Lucknow, partly allowed an appeal filed by Ram Niwas Sunil Kumar against a tax demand arising from discrepancies in Input Tax Credit (ITC) reported under different tax heads.
A Bench of Judicial Member Narendra Kumar and Technical Member Alok Chopra held that a claim for ITC cannot be accepted or rejected solely on the basis of figures reported in the annual GST return. The Tribunal observed:
"The actual availability, admissibility and utilisation of the credit must be verified from the original records and electronic credit ledger."
The dispute arose from discrepancies between ITC reported in GSTR-3B and GSTR-9 and the figures reflected in GSTR-2A for the financial year 2018-19.
Ram Niwas Sunil Kumar, a trader dealing in grocery items and spices, submitted that it had inadvertently reported eligible IGST credit under the CGST and SGST heads due to a clerical error. It contended that the mistake neither resulted in excess availment of credit nor caused any loss of revenue to the Government.
The Tribunal held that the discrepancy required verification of the original records and electronic credit ledger rather than a decision based solely on the annual return figures. It remanded this issue to the proper officer for verification.
Separately, the Bench examined an ITC claim relating to purchases from a supplier who had filed NIL returns during the disputed period. It held that the mere reflection of an invoice in GSTR-2A does not establish eligibility for ITC. A taxpayer must independently satisfy the conditions prescribed under Section 16 of the UPGST Act, 2017.
It also found that Ram Niwas Sunil Kumar had failed to establish that the tax charged on the disputed purchases had actually been paid to the Government. It therefore rejected the ITC claim relating to those transactions.
Accordingly, the GSTAT partly allowed the appeal, remanding the issue of incorrect IGST credit reporting for verification while rejecting the separate ITC claim for failure to establish compliance with the statutory conditions.
For the Appellant: Advocate Sunil Kumar Jaiswal.
For the Respondents: Sanjeev Kumar, Deputy Commissioner, SGST.