• Notification Date: 29-04-2021
• Notification No: 09/2021-22

GST Rectification of Errors Permissible Only At Initial Stages Supreme Court Dismisses Bharti Airtel's Plea For Refund Of Rs.923 Crore

The Supreme Court set aside the Delhi High Court judgment that had allowed Bharti Airtel's plea for rectification and refund of excess GST worth Rupees 923 Crores paid by it during the period between July-September 2017. The Honourable Supreme Court of India in the matter of Union of India vs. Bharti Airtel Ltd. and Others barred telecom major Bharti Airtel (the Respondent) from seeking Goods and Services Tax (GST) refund of ₹ 923 crores by rectifying return.

"The law permits rectification of errors and omissions only at the initial stages of Forms GSTR­1 and GSTR­3, but in a specified manner. It is a different dispensation provided than the one in the pre­-GST period, which did not have the provision of auto-populated records and entries."

The bench said an assessee cannot be permitted to unilaterally carry out rectification of his returns submitted electronically in Form GSTR-A3B, which inevitably would affect the obligations and liabilities of other stakeholders, because of the cascading effect in their electronic records. "There would be complete uncertainty and no finality could ever be attached to the self-assessment return filed electronically," added the bench.

The bench also upheld the circular issued by the commissioner (GST) which had restricted the rectification of Form GSTR-A3B in respect of the period wherein error had occurred.

The top court agreed with the Centre's contention that any indulgence shown contrary to the statutory mandate would not only be illegality but will lead to a chaotic situation and collapse of the tax administration of Union, states, and union territories. The tax authorities denied any refund alleging that Airtel had under-reported input tax credit during the period. Airtel had argued it had paid excess tax of Rs 923 crore on inputs based on estimates since the GSTR-2A form was not operational during the period, wherein the error occurred.

The top court said the factum of non-operability of Form GSTR-A2A, therefore, is a flimsy plea taken by Airtel. "Indeed, if the stated form was operational, the same would have come handy to the writ petitioner for doing self-assessment regarding the eligibility of ITC and availing thereof", it noted.

The high court had directed that on the filing of the rectified Form GSTR-3B, they shall, within two weeks, verify the claim set forth by Airtel and give effect to the same once verified.