Delayed filing their GSTR-3B return for FY 2019-20 , Remand of GST Case for Fresh Consideration Due to Amendment in Time Limit for Filing Returns

Summary in Key Points:

Issue: Whether a GST assessment order should be set aside and the assessee given an opportunity to respond to the show cause notice (SCN) in light of an amendment to the Finance Act extending the time limit for filing returns and claiming Input Tax Credit (ITC).
Facts: The assessee had delayed filing their GSTR-3B return for the financial year 2019-20. An SCN was issued, and an order was passed against the assessee. However, an amendment to the Finance Act, 2024 extended the time limit for filing returns and claiming ITC.
Decision: The High Court, following a similar decision by a Co-Ordinate Bench, set aside the impugned order and remanded the matter to the stage of the SCN. The court directed the authorities to implement the amended provisions of the Finance Act and provide the assessee with a reasonable opportunity to respond to the SCN.

Decision:

The High Court ruled in favor of the assessee, setting aside the impugned order and remanding the matter to the stage of the SCN. The court emphasized the following:

Amendment to Finance Act: The court acknowledged the amendment to the Finance Act, 2024, which extended the time limit for filing returns and claiming ITC.
Consistent Approach: The court followed a similar decision by a Co-Ordinate Bench, which had remanded a similar case to the SCN stage in light of the amendment.
Opportunity to Respond: The court directed the authorities to provide the assessee with a reasonable opportunity to respond to the SCN, considering the amended provisions of the Finance Act.
Fresh Adjudication: The authorities were directed to hear the assessee and proceed further in accordance with the law after considering the assessee’s response.

Important Note: This case highlights the importance of considering legislative amendments and ensuring that taxpayers are given a fair opportunity to comply with the law. The High Court’s decision to remand the matter to the SCN stage allows the assessee to rectify their delay in filing returns, considering the extended time limit provided by the amendment to the Finance Act. This approach promotes fairness and ensures that taxpayers are not penalized for delays caused by changes in the legal framework.

HIGH COURT OF KARNATAKA

Frontier Shelters (P.) Ltd.

Joint Commissioner

M.I. Arun, J.

WRIT PETITION NO. 29139 OF 2024 (T-RES)

NOVEMBER 5, 2024

Smt. Vani H., Adv. for the Petitioner. Hemakumar K., AGA and Jeevan J. Neeralgi, Adv. for the Respondent.

ORDER

1. Petitioner company is a registered dealer under the provisions of the Central Goods and Services Tax Act, 2017 and the Karnataka Goods and Services Tax Act, 2017 (for short ‘CGST/KGST Act, 2017). There has been a delay in filing GSTR 3B for the financial year 2019-20 by the petitioner. Hence, show cause notice was issued and the impugned order came to be passed by respondent No.1 (vide Annexure-B to the writ petition), order of adjudication (vide Annexure-E to the writ petition) by respondent No.2 and the show cause notice (vide Annexure-D to the writ petition) has been issued by respondent No.2. Aggrieved by the same, present writ petition is filed.

2. During the course of arguments, learned counsel for petitioner submits that amendment has been effected to Finance Act, 2024 more particularly Section 118, wherein, time for filing the returns and claim input tax credit has been extended and the petitioner would be satisfied if the impugned orders are set aside and petitioner is given an opportunity to reply to show cause notice issued. It is further submitted that the Co-ordinate Bench of this Court in similar circumstance has passed orders accordingly.

3. Learned AGA appearing for respondent Nos.2 and 4 has no objections for the same.

4. As similar matters have been remanded to the stage of show cause notice by a Co-Ordinate Bench of this Court, I am of the opinion that it would be appropriate to pass similar orders in the instant writ petition also. There is no reason why the orders passed in W.P.No.6138/2020 should not enure to the benefit of the petitioner. Hence, the following:

ORDER

(i)

Accordingly, the writ petition is disposed of;

(ii)

Parties are remitted to the stage of show cause notice dated 21.05.2024 issued by respondent No.1 (Annexure-A to the writ petition) and dated 07.08.2024 issued by respondent No.2 (Annexure-D to the writ petition) and the respondents are directed to give effect to and implement the amended provisions contained in Section 118 of the Finance Act, 2024 relating to insertion of Section 16(5) to the CGST/KGST Act, 2017 by providing sufficient and reasonable opportunity and hear the petitioner and proceed further in accordance with law within a period of one month from the date of receipt of certified copy of this order;

(iii)

Impugned order in original dated 14.08.2024 passed by respondent No.1 (vide Annexure-B to the writ petition), impugned demand notice dated 27.08.2024 (vide Annexure-C to the writ petition) and the impugned adjudication order dated 07.08.2024 passed by respondent No.2 (vide Annexure-E to the writ petition) are hereby set aside.

In view of disposal of main petition, pending interlocutory applications, if any, stand disposed of.