GST Update: It has been almost 7 years since GST was implemented, but even today it is being improved. A case of this complexity of GST law reached the Allahabad High Court, where the court ruled in favor of the businessman on the ITC refund sent on the wrong GSTIN.
This is big news for millions of businessmen of the country. Even if you get a refund of input tax credit (ITC) on the wrong GST number (GSTIN), the department cannot reject it and you will have to pay the full amount. Allahabad High Court has also given its decision in this case. The court has said that if the businessman has fulfilled all the rules and compliances on his part, then he is entitled to get a refund.
This is the case of My Auto World (Kanpur) Private Limited vs Union of India and 5 others. A very interesting case came to light in this case heard in Allahabad High Court. In the case, the court ruled that taxpayers should be given the benefit of ITC in the case where GST invoice has been generated on a different GSTIN in the same state.
What was the whole matter
In this case that reached the High Court, the petitioner was given two GST numbers by the GST department, which were issued on the same PAN. When the petitioner claimed ITC on his business, the supplier issued a refund on the GSTN which had been closed or on which ITC cannot be claimed. GST officials later rejected the ITC claim and demanded the outstanding tax from the petitioner.
Cited the rules in the court
The petitioner cited the GST rules in the High Court, referring to a decision of the Allahabad High Court itself. He told the court that according to the circular issued by the GST department, even if the supplier has refunded ITC on the wrong GSTN, the businessman is entitled to get the full amount. This money can be adjusted in the demand sent by the department.
What decision did the High Court give
In the latest case, the High Court clearly said that the GST circular clearly states that taxpayers who follow all the compliances should not face any problem. If a duplicate GSTN has been issued to a businessman, then the ITC amount should be given to him after adjusting it. The GST law has been made only to ensure compliance, not to create problems.
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