Benefit of Amnesty Scheme providing relief to non-filers of GSTR-9, also applies to returns filed before scheme's implementation

Facts of the Case:- In this case, the Petitioner had filed annual returns in FORM GSTR-9 for the financial years 2017-18, 2018-19, and 2019-20 after the prescribed due dates. For this, the petitioner has paid tax due and interest for filing the returns along with the prescribed late fee under Section 47 of the CGST / SGST Act. However, the department further demanded late fees, considering the date of filing the reconciliation statement in FORM GSTR-9C as the date of return filing, and demanded  late fee of Rs. 2,93,600/- under Section 47(1) of the CGST / SGST Act, after adjusting the late fee of Rs. 57,600/- paid by the petitioner.

Petitioner's Submission:- The Petitioner submitted that a registered person is liable to pay the late fee under Section 47(2) only when he fails to furnish the return in FORM GSTR-9 under Section 44 of the CGST / SGST Act. GSTR-9C is only a reconciliation statement to be filed along with the annual return and FORM GSTR-9C is not a return as contemplated under Section 44 of the CGST / SGST Act. Late fee is levaible upto the late filing of GSTR-9 return and not GSTR-9C reconciliation statement.

Further, it was submitted that in accordance with the Amnesty scheme by the government vide Notification No.7/2023-CT dated 31.03.2023, with respect to the non-filers of GSTR-9 returns, provided relief to the non-filers of the returns for the financial years 2017-2018 to 2021-2022 to file the returns in GSTR-9 and 9C upto 30.06.2023, which was further extended vide Notification No. 25/2023 upto 17.07.2023. Also, the scheme waived late fees exceeding Rs. 10,000 with respect to the returns filed within the specified time for the financial years 2017-2018 to 2019-2020. 

Also, it was submitted that the petitioner should be extended the benefit of the said notifications, as they  had filed the annual return for the said year as early as in the years 2020-2021 and before the commencement of the Amnesty Scheme, i.e., on or before the commencement of the Amnesty Scheme with effect from 01.04.2022.

Department's Submission:-  The aforementioned Amnesty Scheme is applicable only to the persons who had not filed the return for the financial years 2017-2018, 2018-2019 and 2019-2020, and not the persons who had filed the return for the said financial years before 01.04.2023.The dealers who did not file the returns for the financial year (s) 2017-2018, 2018-2019 and 2019-2020 but furnished the returns on or after 01.04.2023 upto 31.08.2023, the late fee would be limited to Rs. 10,000/- only.

Further, under unamended Section 44 of the CGST / SGST ACT, the FORM GSTR-9 and 9C were required to be filed together and therefore, if the GSTR-9C was not filed along with GSTR-9, it could not be said that the dealer had filed the annual return as contemplated under the provisions of Section 44 of the CGST / SGST Act. It is therefore, submitted that the date of filing of the GSTR-9C would be the relevant date for calculating the late fee, if the same is not filed along with the GSTR-9.

Held:- The High Court held as under

• In respect to filing the annual return as GSTR-9C, substantial changes have been brought in by the Finance Act, 2021 with effect from 01.08.2021 under Section 44 of the CGST Act, 2017 with effect from 01.08.2021, taxpayers are now required to self-certify a voluntary reconciliation statement and file it with the tax authorities on or before 31st December of the year following the relevant financial year. The format of Form GSTR-9C has been modified to support self-certification.
• It is evident from amended Section 44 which provides that the taxpayer “shall furnish an annual return which may include a self-certified reconciliation statement,… with the audited annual financial statement.” Though Section 44 uses the phrase “shall furnish an annual return which may include, however, the amended Rule 80 makes GSTR-9C mandatory for the taxpayer, whose aggregate turnover above Rs. Five Crores.
• Also, it is noted that GST portal does not support payment of late fees for the late filing of GSTR-9C. The GST portal enables to charge late fee for GSTR-9 only, lacking the provisions for GSTR-9C late fees.  Annual return GSTR-9 filed without 9C may be deficient attracting general penalty. However, late fee cannot be made applicable for regularising the GSTR-9 by filing GSTR-9C.
• The purpose of Amnesty scheme is to provide relief to the non-filers, however, continued issuing of notices for non-payment of late fee for belated GSTR-9C, that too filed by the taxpayers before 01.04.2023 i.e. the date on which one time amnesty commences is contradictory to the Scheme. 

The notices are unjust and unsustainable to the extent it sought to collect late fee for delay in filing GSTR-9C. However, it is made clear that the petitioners will not be entitled to claim refund of the late fee which has already paid by them over and above Rs. 10,000/-. 

To read the complete judgment 2024 Taxo.online 768