Technical Glitch in GST Portal Cannot Deprive Taxpayer to Claim ITC: Gujarat HC

Taxpayers are entitled to claim Input Tax Credit (ITC), according to the Gujarat High Court, and a technological fault in the GST Portal should not prevent them from doing so.

The department attempted to submit the ITC – 01, however the authority concerned was unable to do so due to a technical fault in the GSTN system. Following that, the authorities sought advice from Gujarat’s E.D.P. Cell on what could be done. The Gujarat E.D.P. Cell, in turn, requested that the Assistant Commissioner notify the GSTN via a Nodal Officer. The Nodal Officer was alerted by the Assistant Commissioner. Nothing, however, could be worked out.

To some extent, the writ petitioner, Ezzy Electricals, is equally at fault because it appears that the inappropriate offline tool was utilised when attempting to upload the Form ITC – 01. It is clear from the department’s affidavit-in-reply that this is the case.

If the writ applicant is otherwise qualified to claim the Input Tax Credit under Section 18(1)(c) of the Act, a technical malfunction in the portal should not prevent him from doing so, according to the division bench of Justice J.B.Pardiwala and Justice Nisha M.Thakore. It was within the department’s power to mediate the conflict and ensure that the necessary steps were taken.

Mr. Uchit Sheth, the learned counsel standing for the writ applicant, is correct in his assertion that if the department had informed his client about a wrong offline tool being used by the writ applicant at the earliest possible time, something could have been worked out.

It is now up to the respondents to take the necessary steps to ensure that the writ applicant is permitted to upload Form ITC – 01 in order to claim the Input Tax Credit of approximately Rs.5 lakh under Section 18(1)(c) of the Act. Mr. Sharma has assured this Court that the necessary steps will be taken as soon as possible.

The court ordered the defendants to take the necessary steps to ensure that the writ petitioner can claim the Input Tax Credit by submitting Form ITC – 01. This exercise should be started as soon as possible and completed within six weeks of receiving the writ of this order. One copy of this order must be given to Mr. Sharma as soon as possible for forwarding.

To Read Judgment Download PDF Given Below :