M/S Jagdamba Enterprises vs. Union Of INDIA

Held

The Court held that there appeared to be an apparent contradiction between the auto-populated data of ITC summary in Annexure-P/2 and the ITC claimed by the petitioner in GSTR-9. The Court acknowledged the petitioner's contention that this discrepancy arose due to a technical glitch, not on their part, and that clerical or arithmetical errors due to such glitches are beyond the petitioner's ability to rectify. Considering that the interest of justice would be served by allowing the petitioner an opportunity to present their case, the Court set aside the assessment order. The matter was remanded back to the Adjudicating Authority to pass a fresh assessment order after providing the petitioner an opportunity of hearing, taking into consideration the specific contentions raised by the petitioner, in accordance with law within two months. No issue was expressly left undecided.

Facts

The petitioner, M/s Jagdamba Enterprises, filed a writ petition challenging an order dated 14.12.2023, passed under Section 73 of the GST Act by the Adjudicating Authority. This order imposed a tax, interest, and penalty of Rs. 22,62,318/- for the period 2017-18. The petitioner argued that their claimed Input Tax Credit (ITC) in GSTR-3B (Rs. 60,53,895.38) was less than the total ITC available as per GSTR-2A (Rs. 76,16,209.08). A significant discrepancy arose from the ITC figure in GSTR-9 (Rs. 50,81,750.56), which the Adjudicating Authority relied upon. The petitioner contended this GSTR-9 figure was auto-populated due to a technical error and could not be corrected by them.

Key Issues

1. Whether the Adjudicating Authority erred in imposing tax, interest, and penalty based on a discrepancy in auto-populated ITC data in GSTR-9, which the petitioner claims is due to a technical error? (Question of law and fact, concerning Section 73 of the GST Act). Petitioner's Arguments: The petitioner argued that the ITC claimed in GSTR-3B was less than the available ITC in GSTR-2A. They further contended that the ITC figure auto-populated in GSTR-9 (Rs. 50,81,750.56) contradicted the GSTR-2A data and was a result of a technical glitch, not their fault. They relied on Supreme Court's observation in *Central Board of Indirect Taxes and Customs Vs. M/s Aberdare Technologies Private Limited & Ors.* and a Division Bench judgment of the same High Court in *Om Traders Vs. Union of India* regarding technical or human errors. Revenue's Arguments: The State argued that the ITC reflected in GSTR-3B might be less than that auto-populated in GSTR-2A because the GSTR-3B figure is a net of reversals, including those on account of reverse charge.