Section 16(4) GST ITC Deadline to November 30 with effect from July-2017
KERALA HIGH COURT
M.Trade Links
Vs
Union Of India
Appeal Number : WP(C) NO. 31559 of 2019
Date of Judgement: 04/06/2024
In the present batch of writ petitions, challenge has been made to Sections 16(2)(c) and 16(4) of the Central Goods and Services Tax Act and State Goods and Services Act, 2017.
BACKGROUND
It took 13 long years, i.e., 2004-2017, for Goods and Services Tax to finally arrive in India, and a new tax regime could see the light of the day with effect from 01.07.2017. The Kelkar Committee used the word ‘GST’ for the first time in a formal document, i.e., the Executive Summary of the Kelkar Committee report. The Kelkar Committee proposed that the Union and the States should concurrently tax the consumption of almost all goods and services in the economy, and it should be based on the principles of Value Added Tax (for short ‘the VAT’). All existing legislation taxing goods and services with cascading effects should be withdrawn. The GST would subsume existing indirect taxes including central excise and service tax.
A White Paper on State-Level Value Added Tax’ (‘the white paper’) was published by the Empowered Committee of the State Finance Ministers on 17.0 1.2005. The ‘White Paper’ discussed features such as Input Tax Credit (‘the ITC’ for short), multiplicity of rates and taxes, etc., and provides uniform taxes and rates. In the budget speech for the Financial Year 2006-2007, the then Finance Minister announced a large consensus on a national goods and services tax. An empowered committee was constituted to prepare a road map for a National GST. In the budget speech of the Union Finance Minister 2009-20 10, GST was considered as a dual tax structure consisting of central GST and State GST, legislated and administrated by the Central and States, respectively.
Important Para
Para 99 Conclusion: The Government had realized the difficulty in the initial roll out of the GST regime under the CGST/SGST Act and considered that GSTR 2A was not available initially in the Finance years, 2017-2018 and 2018-2019, during the implimentation of GST. In order to resolve all bona fide claims and mistakes, Circular No.183/15/2022- GST dated 27.12.2022 and Circular No. 193/05/2023- GST dated 17.07.2023 have been issued. Circulars cover the period from the introduction of GST till Section 16(2)(aa) was introduced with effect from 01.01.2022. The ITC can be availed by the recipient for the bona fide scenarios listed in those Circulars on submitting proof of payment to the Government by the supplier. Therefore, if, during the pendency of these writ petitions, the petitioners who could have got the benefits of these Circulars and could not avail the benefits within the time limit prescribed, may approach the appropriate GST authority within a period of thirty days from today to avail the benefit of the aforesaid Circulars, if the same is/are applicable to their case. The GST authorities will examine the claim of the individual dealer by applying the provisions of the Circulars, and it will grant applicable relief to eligible dealers.
Para 100. Prior to the amendment in Section 39 by the Finance Act 2022, the date for furnishing the return under Section 39 was 30th September. Considering the difficulties in the initial stage of the implementation of the GST regime, its understanding, and compliance, the Legislature effected the amendment and extended the time for filing the return for September to 30th November in each succeeding Financial Year. The amendment is only procedural to ease the difficulties initially faced by the dealers / taxpayers. Therefore, where for the period from 01.07.2017 till 30.11.2022, if a dealer has filed the return after 30th September and the claim for ITC was made before 30th November, the claim for ITC of such dealer should also be processed if he is otherwise entitled to claim the ITC. It has been pointed out in several cases which are pending before this Court that the claim was made before 30th November of the succeeding Financial Year, but the relevant period was 20th October, which was the extended date for furnishing the return under Section 39 for the month of September. Therefore, if a person has furnished the return for the month of September till 30th November, their claim should also be considered and processed and should not be rejected if the dealer did not furnish the return for the month of September on or before 20th October. This amendment being procedural has to be given retrospective effect and, therefore, it is provided that it should be treated that the time limit for furnishing the return for the month of September is 30th November in each Financial Year with effect from 01.07.2017, considering the peculiar nature of difficulties in the initial period of implementation of the GST regime. So far as the challenge to the constitutional validity of Section 16(2)(c) and Section 16(4) is concerned, the same is rejected.
Para 101 Result: The liberty is granted to the petitioners, who can claim the benefit of the two Circulars, namely, Circular No. 183/15/2022 GST dated 27.12.2022 and Circular No. 193/05/2023- GST dated 17.07.2023 to make their claim within one month from today before the appropriate authority who shall examine the claim of the individual dealer and process the claim.
- The time limit for furnishing the return for the month of September is to be treated as 30th November in each financial year with effect from 01.07.2017, in respect of the petitioners who had filed their returns for the month of September on or before 30th November, and their claim for ITC should be processed, if they are otherwise eligible for ITC. The writ petitions are hereby disposed of. All Interlocutory Applications as regards interim matters stand closed
