Kerala High Court Asserts ITC Cannot be Denied Solely Based on GSTR-2A and GSTR-3B Discrepancies

• Petition Details:

- The writ petition challenges the assessment order (Ext.P1) and the recovery notice (Ext.P2) dated 20-8-2022 and 24-7-2023, respectively.

• Grounds of Assessment:

- The assessment order suggests that the petitioner's claim for input tax credit is based solely on the variance between GSTR 2A and GSTR 3B.

• Legal Precedent Cited:

- Refers to a previous case, Diya Agencies v. The State Tax Officer, dated 12-9-2023, where it was highlighted that input tax credit cannot be denied solely on the difference between GSTR 2A and GSTR 3B.

- Mentions the Supreme Court's judgment in The State of Karnataka v. M/s Ecom Gill Coffee Trading Private Limited and a Calcutta High Court judgment in Suncraft Energy Private Limited v. The Assistant Commissioner, State Tax, Ballygunge Charge.

• Quoted Court Decision (Diya Agencies):

- Paragraph 8 of the Diya Agencies case emphasizes that denial of input tax credit based on GSTR discrepancies is not sustainable.

- The court orders the matter to be remanded back to the Assessing Officer, providing the petitioner an opportunity to substantiate the claim for input tax credit with evidence.

• Court's Directive:

- The present writ petition is allowed, and the case is sent back to the Assessing Authority for reconsideration.

- The Assessing Authority is instructed to examine the petitioner's evidence, regardless of the GSTR 2A form, and make a decision in accordance with the law.

• Specific Instructions:

- The petitioner is directed to appear before the Assessing Officer on 3-10-2023 at 11.00 a.m.

- The petitioner must present all evidence supporting the claim for input tax credit during this appearance.

• Conclusion:

- The court orders a reevaluation of the input tax credit claim, emphasizing the need for a thorough examination of evidence and instructing the Assessing Authority to pass fresh orders based on the findings. Mina Bazar Vs. State Tax Officer-1