Karnataka High Court: Circular Regarding Mismatch Of ITC Is Applicable For 2019-2020 In Case Of Identical Errors

The Karnataka High Court in the case M/s Wipro India Ltd. Versus Assistant Commissioner Of Central Tax observed and has held that the circular regarding the mismatch of input tax credit (ITC) is applicable for 2019– 2020 in the case of identical errors. The Single bench headed by Justice S.R. Kumar stated that though the Circular refers only to the years 2017–18 and 2018–19, since there are identical errors committed by the petitioner not only in respect of the assessment years 2017–18 and 2018–19 but also in relation to the assessment year 2019–20 also, this court is of the view that by adopting a justice-oriented approach, the petitioner would also be entitled to the benefit of the Circular for the year 2019–20. However, a clarification is issued in a Circular No. 183/15/2022 for dealing with differences in the input tax credit (ITC) available in Form GSTR-3B as compared to Form GSTR-2A for FY 2017–18 and FY 2018–19. Therefore, the circular addresses the correction of both genuine and unintentional errors made by individuals when filing forms and submitting returns. Further, there was an ITC mismatch, due to an accidental incorrect mention of the recipient’s GSTIN. The error pertaining to 2019–20. Thus, the rectification in error was allowed in accordance with Circular 183 of 2022 with regard to the specific years 2017–18 and 2018–19. Further, it has been claimed by the petitioner before the High Court that the same mistakes had also been made in relation to 2019–20. Thus, the rectifications of the mistakes which are made in 2019–20 should be permitted in accordance with Circular 183 of 2022. It has also been submitted by the petitioner that the supplies were made by the petitioner to ABB Global Industries and Services Private Limited, but the GSTIN mentioned in the invoices has been incorrectly shown as that of ABB India Limited, which being completely different, independent juristic and legal entity. It has also been held by the court that the error committed by the petitioner in showing the wrong GSTIN number in the invoices was carried forward in the relevant forms as that of ABB India Limited instead of that of the ABB Global Industries and Services Private Limited. The same being a clear bona fide error that has occurred due to bona fide reasons, unavoidable circumstances, or sufficient cause. However, the circular would be directly and squarely applicable. Accordingly, the court directed the department for taking necessary steps in relation to the petitioner for the assessment years 2017–2018, 2018–19, and 2019–20 in terms of Circular No. 183/15/2022–GST dated 27.12.2022.

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