The income tax (I-T) department on Wednesday moved the Supreme Court against the Delhi High Court’s May order that allowed Sunil Bharti-led Bharti Airtel to claim refund of Rs 923 crore by rectifying its GST returns for July to September 2017. The refund was denied earlier by the revenue authorities.
The HC, while asking the revenue authorities to verify the rectified GSTR-3B form and process the refund, if any, within two weeks, said if the statutorily prescribed returns GSTR-2 and GSTR-3 had been operationalised by the government, Bharti would have known the correct the input tax credit (ITC) amount available to it in the relevant period, and could have discharged its liability through ITC.
“As a consequence, the deficiency in reporting the eligible ITC in the months of July-September 2017 in the form GSTR-3B has resulted in excess payment of cash by Bharti,” the high court stated.
Challenging the judgment, the department said the finding of the HC that there is no statutory provision permitting rectification of errors only in the return with respect to the month in which such error is noticed and not in the return with respect to the month in which the error relates, overlooks and directly contravenes the express wordings of Section 39(9) of the Central Goods and Services Tax Act, 2017.
“The submissions of the Revenue regarding the rationale behind not permitting rectification of the return for the period to which an error relates, were not considered or addressed by the HC in the impugned judgment,” the GST department said in its appeal before the apex court.
Bharti had moved the HC seeking refund of excess tax of Rs 923 crore. It wanted to correct the anomaly in October 2018 as it had underreported its claim for credit, but was prevented from doing so as the government’s December 2017 circular disallowed companies from making rectifications under the earlier circular of September 2017.
Source : Financial Express