𝗦𝘂𝗽𝗿𝗲𝗺𝗲 𝗖𝗼𝘂𝗿𝘁’𝘀 𝗟𝗮𝗻𝗱𝗺𝗮𝗿𝗸 𝗠𝗼𝘃𝗲: 𝗕𝗿𝗶𝗷 𝗦𝘆𝘀𝘁𝗲𝗺 𝗖𝗮𝘀𝗲 𝗦𝗲𝘁 𝘁𝗼 𝗥𝗲𝘀𝗵𝗮𝗽𝗲 𝗚𝗦𝗧 𝗜𝗧𝗖 𝗳𝗼𝗿 𝗔𝗹𝗹 𝗧𝗮𝘅𝗽𝗮𝘆𝗲𝗿𝘀!

𝗦𝘂𝗽𝗿𝗲𝗺𝗲 𝗖𝗼𝘂𝗿𝘁’𝘀 𝗟𝗮𝗻𝗱𝗺𝗮𝗿𝗸 𝗠𝗼𝘃𝗲: 𝗕𝗿𝗶𝗷 𝗦𝘆𝘀𝘁𝗲𝗺 𝗖𝗮𝘀𝗲 𝗦𝗲𝘁 𝘁𝗼 𝗥𝗲𝘀𝗵𝗮𝗽𝗲 𝗚𝗦𝗧 𝗜𝗧𝗖 𝗳𝗼𝗿 𝗔𝗹𝗹 𝗧𝗮𝘅𝗽𝗮𝘆𝗲𝗿𝘀!

In a significant ruling on 24.03.2025, the Hon’ble Supreme Court dismissed SLPs filed by CBIC against the Bombay High Court’s judgments, affirming that a buyer’s legitimate Input Tax Credit (ITC) cannot be denied due to clerical or technical errors made by the seller.

Summary of Order:

• Re-examination of Timeline: The petitioner, CBIC, must re-examine the provisions/timelines fixed for correcting the bonafide errors.
• Realistic Time limits needed: Time lines should be realist as lapse/defect invariably is realized when ITC is denied to the purchaser when benefit of tax paid is denied. Purchaser is not at fault, having paid the tax amount. He suffers because he is denied benefit of tax paid by him. consequently, he has to make double payment.
  
• Human errors are unavoidable: Human errors and mistakes are normal, and errors are also made by the Revenue.
• Revenue admits existence of Clerical/Arithmetical errors: In these cases, even the Revenue acknowledges the presence of genuine clerical or arithmetical errors, yet refuses correction on procedural grounds.
• Errors surface only after ITC denial: Invariably, such mistakes come to the notice of the seller, who has to fill up the online form(s), etc., after the ITC is denied to the purchaser(s).
• Right to correct errors is a business right: Right to correct mistakes in the nature of clerical or arithmetical error is a right that flows from right to do business and should not be denied unless there is a good justification and reason to deny benefit of correction.
• Software limitations not a valid excuse: Software limitation itself cannot be a good justification, as software are meant ease compliance and can be configured.
• Issues notice to CBIC to resolve the issue of subsequent denial of Input Tax Credit to purchaser on account of mistakes or error.
• Appoints legal luminary & Sr. Adv. Arvind Datar as Amicus Curiae to assist the Court and posts matter for April 28, 2025 for further hearing

🗓 Next hearing: April 28, 2025
🔎 Taxpayer rights are fundamental!

📌 Case References:

UIO v/s Brij Systems Ltd | TS-173-SC-2025-GST

CBIC vs Aberdare Technologies Pvt. Ltd | TS-172-SC-2025-GST