Summary / Headnotes
Held - The Supreme Court dismissed the SLP, thereby affirming the Calcutta High Court’s ruling that ITC cannot be denied to a bona fide purchaser complying with Section 16(2), merely due to supplier non-reporting in GSTR-2A, and revenue must proceed against the supplier first (Para 8, 9 & 10).
In favour of assessee
AI Summary of the Case
Question Answered
Issue 1: Validity of ITC reversal due to non-reflection of supplier invoices in GSTR-2A (Period 2017-18).
Views: Reversal of ITC from buyer not sustainable merely because invoices were absent in GSTR-2A. Press release dated 18-10-2018 clarified GSTR-2A is only for taxpayer facilitation, not a statutory bar. Reversal permissible only in exceptional cases of collusion, missing supplier, or lack of assets. Assessee produced valid invoices and bank payment proofs; hence, ITC eligible. Having regard to the facts and circumstances, no interference warranted under Article 136. Thus, HC ruling sustained (Para 3).
Issue 2: Compliance with Section 16(2) of CGST Act, 2017 by Assessee.
Views: Assessee possessed valid tax invoices, received goods, and made payment by banking channel—fulfilling all Section 16(2) conditions. Show cause notice faulted only with GSTR-1 mismatch, not invoice possession or receipt. Revenue action arbitrary. Considering demand on lower side and facts, SLP dismissed. Hence, HC’s finding on full compliance with Section 16(2) stands affirmed (Para 2 & 3).
Issue 3: Revenue’s failure to proceed against defaulting supplier before reversing credit from recipient.
Views: Proper course was to initiate action against the supplier first. Revenue’s direct reversal from buyer, despite buyer’s compliance, was unjustified and arbitrary. By declining interference, SC effectively upheld HC’s principle that action against supplier is essential before fastening liability on recipient (Para 3).
Judgment
IN THE SUPREME COURT OF INDIA
BEFORE THE BENCH OF
Mrs. B.V. Nagarathna and
Mr. Ujjal Bhuyan, JJ.
Assistant Commissioner of State Tax
Versus
Suncraft Energy Pvt. Ltd.
Petition for Special Leave to Appeal (C) Nos. 27827-27828 of 2023, dated 14-12-2023
REPRESENTED BY:
Shri Maninder Acharya, Sr. Adv.,
Ms. Madhumita Bhattacharjee, AOR,
Ms. Urmila Kar Purkayastha,
Ms. Niharika Singh,
Shri Akash Mohan Srivastav,
Ms. Srija Choudhury, Advs. for the Petitioner
Shri Ankit Kanodia, Adv.,
Shri Ravi Bharuka, AOR and
Ms. Megha Agarwal, Advs. for the Respondent
[Order].- Delay condoned.
2. We have heard learned senior counsel appearing for the petitioners.
3. Having regard to the facts and circumstances of this case(s) and the extent of demand being on the lower side, we are not inclined to interfere in these matters in exercise of our powers under article 136 of the Constitution of India.
4. The Special Leave Petitions are dismissed, accordingly.
5. Pending application(s), if any, shall stand disposed of.