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2024 (3) TMI 1165 - MADRAS HIGH COURTTransitional credit - Disparity was on account of the transitional credit availed of and reflected in the GSTR 9 annual return - mismatch between the Input Tax Credit (ITC) reported in GSTR 9 versus the GSTR 3B returns - HELD HAT:- The petitioner clearly stated in reply dated 21.09.2023 that transitional ITC of Rs. 1,15,40,474/- was claimed and that this is reflected in the GSTR 9 return but not in the GSTR 3B return. As regards the alleged defect pertaining to Director's remuneration, in the reply dated 27.10.2023, the petitioner stated that the Directors of the Company are based at the head office in Mumbai and that their remuneration would be taxable on RCM basis in the State of Maharashtra and not in Tamil Nadu. Similarly, as regards the blocked credit, it was expressly stated in the reply dated 27.10.2023 that no ITC was claimed in respect of the four items specified under defect no.2. In the impugned order, the respondent has confirmed the tax demand without taking into consideration the above replies of the petitioner. This is also the case with regard to the other defects discussed in the impugned order. Hence, the impugned order is unsustainable. The impugned order dated 31.12.2023 is quashed and the matter is remanded for re-consideration by the respondent - Petition disposed off.
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