Input Credit Claim cannot be denied merely on non-reflection of transaction in GSTR-2A

The Kerala High Court held that if the taxpayer is able to prove that the tax amount is paid to the seller and the Input Tax Credit claim is bonafide, in that case, the Input Credit Claim cannot be denied merely on non-reflection of transaction in GSTR-2A.

A Single Judge Bench of Justice Dinesh Kumar Singh observed that “the impugned Exhibit P-1 assessment order so far denial of the input tax credit to the petitioner is not sustainable, and the matter is remanded back to the Assessing Officer to give opportunity to the petitioner for his claim for input tax credit.”

“If on examination of the evidence submitted by the petitioner, the assessing officer is satisfied that the claim is bonafide and genuine, the petitioner should be given input tax credit”, added the Bench

The Bench also noted that “Merely on the ground that in Form GSTR-2A the said tax is not reflected should not be a sufficient ground to deny the assessee the claim of the input tax credit.”

Advocate Aji V. Dev appeared for the Petitioner whereas Advocate Jasmine M.M. GP appeared for the Respondent. 

The brief facts of the case were that the petitioner’s claim for the input tax credit of Rs.44,51,943.08/- for CGST and SGST has been limited to an excess claim of Rs.1,04,376.05/- as CGST and the same amount as SGST credit has been denied on the ground that as per the GSTR 2A in respect of invoice supply, the taxpayer is only eligible for input tax amount shown in CGSTR 2A. Hence, the Petitioner approached the High Court to seek relief in the same. 

After considering the submission, the Bench observed that the Petitioner’s claim for Input Tax Credit (ITC) has been denied only because the said amount was not mentioned in GSTR 2A.

The Bench stated that if the supplier has not remitted the said amount paid by the Petitioner to him, the Petitioner cannot be held responsible.

Referring to the case The State of Karnataka v. M/s. Ecom Gill Coffee Trading Private Limited, the Bench Reiterated that the petitioner has to discharge the burden of proof regarding the remittance of tax to the seller dealer by giving evidence.

The Bench also considered the press released by the Central Board of Indirect Tax and Customs (CBIC) and stated that GSTR-2A by the recipient is in the nature of taxpayer facilitation and does not impact the ability of the taxpayer to avail ITC on the self-assessment basis in accordance with the provisions of Section 16 of the Act.

Hence, the High Court directed the Adjudicating Authority to to give an opportunity to the petitioner to give evidence in respect of his claim for input tax credit.

Cause Title: Diya Agencies Vs. The State Tax Officer and Ors. [WP(C) NO. 29769 OF 2023 / 2023-Enterslice-21-HC-Kerala-GST]

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