Indirect Tax Advisory

Kerala H.C. rules in favour of assessees on ITC claims for September returns

June 20, 2024
The Hon’ble H.C of Kerala directed that assesses who has filed their returns for month of September on or before 30th November, their claim for ITC should be processed if they are otherwise eligible for ITC

In the case of M. Trade Links v. Union of India Dinesh Kumar Singh, J. WP(C.) NOS. 31559 of 2019 and oths. (June 04, 2024)

In initial years of GST regime, GSTR-2A was not available for the financial year 2017-18 and 2018-19 - In order to resolve bona fide claims and mistakes, Circular No. 183/15/2022-GST dated 27-12-2022 and Circular No. 193/05/2023-GST dated 17-7-2023 was issued. These circulars cover period from introduction of GST till section 16(2)(aa) was introduced with effect from 1-1-2022. For claiming ITC earlier date for furnishing return under section 39 was 30th September. Legislature had effected amendment by Finance Act, 2022 and extended time limit for filing return for September to 30th November.

Thus in the present case if a person has furnished return for month of September till 30th November, his claim should also be considered and processed and should not be rejected if dealer did not furnish return for the month of September on or before 20th October .This amendment being procedural has to be given retrospective effect - So far as challenge to constitutional validity of section 16(2)(c) and section 16(4) was concerned, same was to be rejected.

The Kerala high court ruled in favor of taxpayers regarding claiming ITC for the month of September. As explained above the court clarified that the deadline for filing September’s return to be eligible for ITC is considered 30th November of that financial year with retrospective effect from 1st July 2017. This applies to taxpayers who filed their September return on or before 30th November. As long as they are otherwise eligible for ITC based on GST regulations, their claim for ITC should now be processed by the authorities. This essentially means that taxpayers who filed their September return a bit late (Between the original date and 30th November) can now claim their ITC.

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