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TMI Blog2024 (2) TMI 1175X X X X Extracts X X X X X X X X Extracts X X X X ..... th GST Department Vide Notification No. 3/2019 dated 29th March 2019 a new scheme was introduced for the real estate sector. Under the new scheme, for affordable housing properties effective GST rate is 1% without Input Tax Credit ("ITC) and for residential properties outside affordable segment effective GST rate is 5% without ITC, as opposed to the old regime (i.e. before 1st April 2019) whereunder the GST rate for affordable and residential properties other than affordable were 8% and 12% respectively. For under construction projects, developers were given an option to choose old rates (effective rate of 8% or 12% with ITC) or new rates without ITC. This option was only for under construction projects and had to be exercised within a pres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITC, in terms of the said Notification No. 3/2019, pertaining to unsold units as on 31st March 2019 as per Rule 42 of the CGST Rules. By the following DRC 03 Forms, Petitioner No. 1 had reversed ITC in the following manner. Sr.No. Date of DRC 03 ARN Amount 1. 02.082022 AD270822001276A 13,482,448/- 2. 26.08.2022 AD270822025540B 30,480,886/- 3. 01.09.2022 AD270922000492B 15,647,968/- 7. With respect to DRC 03 dated 2nd August 2022, Petitioner No. 1 had correctly shown that the reversal was made for Financial Year 2018-19. Further, for DRC 03 dated 26th August 2022 and 1st September 2022, Petitioner No. 1 had inadvertently shown the year as Financial Year 2019-20, instead of Financial Year 2018-19. 8. It is the case of the P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... demanding Rs. 2,95,07,519/- [Rs. 29,030,949/- + Rs. 4,76,570/-] along with interest. 12. The Petitioner again, by a letter dated 1st December 2023, submitted that it had complied with the conditions laid down in Notification No. 3/2019 and had accordingly reversed ITC / made payment of GST pertaining to unsold units as on 31st March 2019 as per Rule 42 of the CGST Rules. Details of the payment were again shared with Respondent No. 3 and Respondent No. 3 was requested to consider the said payment as pertaining to Financial Year 2018-19 and, accordingly, drop the demand. 13. However, without considering the said submissions of Petitioner No. 1, Show Cause Notice dated 20th December 2023 was issued by Respondent No. 3 advising Petitioner No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rrectly submitted by Petitioner No. 1, the fact, that the there was a bona fide mistake, was clear from the narration in the said Form DRC 03. Further, as rightly submitted by Petitioner No. 1, in Financial Year 2019-2020, Petitioner No. 1 was not entitled to avail of any ITC and had not availed of any ITC, and, consequently, there was no question of ITC for Financial Year 2019-20 being reversed by Petitioner No. 1. 18. The Division Bench of this Court, in Star Engineers (I) Pvt. Ltd. vs. Union of India and Ors. in Writ Petition No. 15368 of 2023 (of which one of us, G.S. Kulkarni, J., was a member), has held that a bona fide inadvertent error in furnishing details in a GST return need to be recognised, and ought to be permitted to be corr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esent case, was also the situation in the proceedings before the different High Courts as noted by us above, wherein the errors of the assessee were inadvertent and bona fide. There was not an iota of an illegal gain being derived by the assessees. In fact, the scheme of the GST laws itself would contemplate correct data to be available in each and every return of tax, being filed by the assessees. Any incorrect particulars on the varied aspects touching the GST returns would have serious cascading effect, prejudicial not only to the assessee but also to the third parties. 22. It is considering such object and the ground realities, the law would be required to be interpreted and applied by the Department. This necessarily would mean, tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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