Kerala GST Tribunal Sends Mobile Dealer’s FY 2017-18 ITC Dispute Back For Review Under CBIC Circular After Wrong-GSTIN Claim

Arathy Mobiles, a registered dealer, was assessed under Section 73(9) of the GST Act for FY 2017–18 on the ground that it had claimed input tax credit (ITC) exceeding the amount reflected in GSTR-2A; its first appeal was dismissed.

The appellant contended that its supplier, Red Marketing, had reported the supplies under another taxpayer’s GSTIN, causing the invoices to be omitted from the appellant’s GSTR-2A.

It sought consideration of its documents under CBIC Circular No. 183/15/2022-GST, issued after the adjudication and first appeal had concluded.

Revenue did not oppose a remand for de novo consideration under the Circular.

CBIC Circular No. 183/15/2022-GST dated 27 December 2022 provides guidance for resolving differences between ITC claimed in GSTR-3B and ITC reflected in GSTR-2A for FY 2017–18 and 2018–19.

Under paragraph 6, its instructions apply to ongoing proceedings and to cases in which adjudication or appeal proceedings for those financial years remain pending; they do not apply to completed proceedings.

The adjudication was under Section 73(9) of the GST Act.

The Tribunal found that the dispute concerned FY 2017–18 and fell within the subject matter addressed by the Circular.

However, the Circular post-dated both the adjudication and the first appellate decision, so the appellant had not received its benefit in those proceedings.

Given the parties’ agreement to have the matter reconsidered under the Circular, the Tribunal considered a limited remand appropriate, leaving the first appellate authority to assess the claim against the Circular and the supporting documents.

It directed the first appellate authority to reconsider the matter under Circular No. 183/15/2022-GST, consider the documentary evidence, observe the principles of natural justice, and pass suitable orders within three months from the order’s upload on the GSTAT portal.