GST Portal Glitch Led To Multiple Demand Summaries; Delhi High Court Directs Correction Within 15 Days

The Delhi High Court has directed the Goods and Services Tax (GST) Department to rectify multiple demand summaries generated due to a technical glitch in the GST portal within 15 days.

The Division Bench of Justices Anil Kshetarpal and Bharat Parashar also clarified that the statutory pre-deposit for filing an appeal must be calculated on the demand actually confirmed in the assessment order and not on the erroneously repeated amount.

It directed the Department to ensure that the corrected summaries in Form GST DRC-07 faithfully reflect the demand confirmed by the adjudicating authority. It also directed the Department to make the necessary corrections on the common portal and communicate them to Petitioners.

The Court was hearing a writ petition filed by Blue Star International and its directors challenging an assessment order and demand of ₹12,88,99,060.

The proceedings arose from an investigation into the company's alleged availment and utilisation of input tax credit (ITC) on invoices issued by non-existent suppliers, without receipt of the goods covered by those invoices.

Petitioners had also sought the reading down of Section 155 of the CGST Act, which places the burden of proving eligibility for ITC on the person claiming it.

They contended that certain records taken into custody by the Department had not been returned, preventing the company from establishing its eligibility for ITC. They also relied on an earlier order recording the Department's inability to trace a file containing seized documents and argued that reconstructed documents furnished during adjudication had not been duly considered.

The Department, on the other hand submitted that the available documents had been supplied and that the absence of certain records did not relieve the company of its statutory burden of proof.

The Court observed that the grievance concerning unavailable records could be examined without reading down Section 155. It noted that the statutory allocation of the burden of proof and the effect of the absence of particular documents were distinct questions.

It held that the appellate authority would have to examine which records remained unavailable, their relevance to the disputed transactions, the prejudice caused by their absence, and whether the material supplied or reconstructed had been duly considered.

The Court added that the Department's recorded inability to furnish the seized documents must form part of the consideration while assessing whether the company had discharged its statutory burden.

As such, the Court declined to entertain the writ petition and relegated the Petitioners to appellate remedy under Section 107 of the CGST Act.

For Petitioners: Advocates Anjali Jha Manish, Priyadarshi Manish, Saurav Kumar,

For Respondents: Arun Khatri, Sr. Standing Counsel with Advocate Shauray Bal, Adv.