GST Update

 Desk of CA. Praveen Sharma – 1045 Series (CAPS) 

 Madras High Court  IN THE CASE OF M/s. Ashok Agency v. State Tax Officer

Madras High Court: Belated GSTR-3B Returns Must Be Considered Before Finalising GST Assessment

The Madras High Court has provided important relief to taxpayers by holding that belatedly filed GSTR-3B returns cannot be ignored while completing a best judgment assessment under the GST law.

In the case of M/s. Ashok Agency v. State Tax Officer, the taxpayer filed GSTR-3B returns after assessment proceedings had started. These returns disclosed the actual tax liability, which was higher than what the department had estimated. However, the department completed the assessment without considering the belated returns.

The High Court observed that the primary objective of the GST law is to determine the correct tax liability, not to penalise taxpayers for procedural delays. If valid returns are available before the assessment becomes final, the tax authorities should take them into account.

Accordingly, the Court set aside the best judgment assessment order and remanded the matter to the Proper Officer for fresh consideration after examining the belated GSTR-3B returns. The taxpayer was also directed to be given a proper opportunity of hearing.

This judgment reinforces that GST assessments should be based on actual facts and correct tax liability, ensuring fairness and reducing unnecessary litigation. It is a welcome ruling for genuine taxpayers who may have filed returns late but have disclosed the correct tax payable.

LINK:CA. Praveen Sharma on Linkedin

Regards

CAPS