GST ITC Claimed Under Wrong Head Relief from Calcutta High Court
Did you claim GST input under the wrong head in GSTR-3B—CGST/SGST instead of IGST?
You’re not alone—and the Calcutta High Court has now stayed a reversal order in such a case, offering much-needed relief to taxpayers.
Why This Matters
Many businesses make clerical errors in GST Input Tax Credit (ITC) reporting, especially while filing GSTR-3B.
In a recent case, the department demanded reversal of excess CGST/SGST credit claimed instead of IGST—despite no actual revenue loss.
But the Calcutta High Court granted a stay on this demand, questioning whether the correction warranted reversal at all.
Case Summary: Calcutta High Court Relief on ITC Head Misreporting
- Petitioner’s Mistake:
Claimed ITC under CGST and SGST instead of IGST while filing GSTR-3B. - GST Officer’s Order:
Directed reversal of wrongly availed ITC and payment with interest under Section 73 of the CGST Act. - Petitioner’s Argument:
No excess ITC was claimed overall, only an error in head of account. This was an inadvertent clerical error. - High Court Observation:
The revenue didn’t suffer any loss. Reversing ITC and charging interest appears harsh. Stay granted on the reversal order.
Legal Basis and Key Provisions Cited
- Section 73 of the CGST Act, 2017:
Deals with demand of tax not paid or ITC wrongly availed/used without intent to defraud. - Rule 61(5) of the CGST Rules:
GSTR-3B is a summary return. Errors may occur while allocating ITC across tax heads. - Judicial Principle:
If there is no revenue loss and no mala fide intention, harsh recovery isn’t justified.
Practical Takeaways for GST Filers
Here’s what businesses and consultants should remember:
✅ Check ITC head accuracy before GSTR-3B filing
✅ Reconcile GSTR-2B with GSTR-3B monthly
✅ Use DRC-03 for voluntary corrections, if needed
✅ Keep documentary evidence showing no excess claim
Expert View: Correction > Punishment
“When there is no wrongful gain or revenue loss, punitive recovery is unjustified. Department must enable correction, not penalize genuine mistakes.”
— A Senior GST Consultant, Kolkata
FAQ: GSTR-3B ITC Head Error
Q1. Can I adjust ITC in the next month if claimed under wrong head?
Yes, if the department allows. But ideally, consult a tax expert and use DRC-03 for voluntary correction.
Q2. Will interest apply if no revenue loss occurred?
As per the Calcutta HC, interest shouldn’t apply in such cases—subject to final judgment.
Q3. What if my ITC heads were adjusted by the system in auto-population?
Still your responsibility—always cross-check before final submission.
Summary
Calcutta High Court has stayed a GST officer’s order demanding reversal of ITC claimed under CGST/SGST instead of IGST in GSTR-3B. The court held that clerical errors causing no revenue loss shouldn’t attract reversal or interest, offering major relief to taxpayers.
Final Word
Wrong ITC head? Don’t panic—but don’t ignore it either.
While courts may offer relief, proactive compliance is the best strategy.