《2017年CGST法案》第16(4)条的合宪性得到维持

By Hon’ble Patna High Court

案件背景

Gobinda Construction Vs Union of India through the Secretary (Patna High Court) (Civil Writ Jurisdiction Case No. 9108 of 2021)

The Petitioner filed GSTR-3B for the month of Feb, 2019 and March, 2019 on 23.10.2019 and 07.11.2019 respectively. The respondent disllowerd the ITC claimed in GSTR-3B due to condition given under Section 16(4) of CGST Act, i.e., ITC can’t be claimed beyond the due date of filing of return for the month of September of following year. The Petitioner challenged that Section 16(4) is volatile of Article 300-A of Constitution of India as it takes way right to property.

Hon’ble High Court held that Section 16(4) if The language of Section 16 of the CGST Act suffers from no ambiguity and clearly stipulates grant of ITC subject to the conditions and restrictions put thereunder. Section 16(4) prescribes one of the conditions to make a registered person entitled to take ITC. Therefore, right of a registered person to take ITC under Section 16(1) becomes a vested right only if such condition is fulfilled. ITC is not unconditional and a registered person becomes entitled to ITC only if the requisite conditions given are fulfilled and restrictions given under Section 16(4) does not apply.Therefore, Section 16(4) of CGST Can’t be said to be violative of Article 300-A of the Constitution of India.

1. 案情简介

• The petitioner filed the GSTR-3B for the month of Feb, 2019 and March, 2019 on 23rd October, 2019 and 7th November, 2019 respectively.
• The Petitioner received the SCN proposing to disallow ITC for the tax period of February and March 2019 on the ground of late filing of return in Form GSTR-3B.
• The petitioner replied that disallowance of ITC in terms of Section 16(4) of the Act was not justified. The petitioner claimed that it filed the return in prescribed Form GSTR-3B and had made necessary disclosures in the form.
• As per SCN, the petitioner had availed ITC for the tax period February 2019 and March 2019 in breach of Section 16(4) of the CGST Act. 
• Aggrieved by the order, the petitioner preferred an appeal before the Additional Commissioner of State Tax (Appeal). However, appeal got dismissed on the ground that ITC availed by the petitioner was inadmissible as per Section 16(4) of CGST Act.
• The authorities disallowed ITC availed by the petitioners for delayed filing of their return by invoking Section 16(4) of CGST Act.

2. Issues Before Hon’ble High Court

Common challenge before Hon’ble High Court is:

1. Constitutional validity of Section 16(4) of the CGST Act which denies entitlement of Input Tax Credit (ITC) for invoice or debit note after the due date of furnishing of returns of September Month of the following year. Section 16(4) is violative of Articles 14 and 300A of the Constitution of India.
2. Further, Conditions given u/s 16(4) of CGST Act are merely procedural in nature and cannot override substantive conditions prescribed under Section 16(1) and Section 16(2) of CGST Act. 
3. There is no non obstante clause given under Section 16(2) and therefore, the same shall prevail over Section 16(4) of the Act. 
4. Also, return in GSTR-3B cannot be treated to be a return prescribed under Section 39(1) of the CGST Act as it does not satisfy the parameters of a return contemplated under Section 39(1) of the said Act. Further, retrospective amendment, prescribing Form GSTR-3B as a return under Section 39(1) of the CGST Act, is ultra vires Section 39(1) of the CGST Act itself. 

3. Legal Extracts

Relevant Extracts of the law is reiterated below for ease of reference:

1. Section 16(4) of CGST Act:

“16. Eligibility and conditions for taking input tax credit.-

…

(4) A registered person shall not be entitled to take input tax credit in respect of any invoice or debit note for supply of goods or services or both after the due date of furnishing of the return under section 39 for the month of September following the end of financial year to which such invoice or debit note pertains or furnishing of the relevant annual return, whichever is earlier.

……”

Section 16(4) has been amended by the Finance Act, 2022, with effect from 01.10.2022, whereby the words and figures "due date of furnishing of the return under Section 39 for the month of September" stand substituted by "30th day of November".

4. Contention of the Petitioner

The Petitioner has contented that;

1. ITC is a vested right under Article 300A of the Constitution of India and such protected and vested right cannot lightly be taken away due to belated filing of return. 
2. Further, Restrictions given under Section 16(4) would apply only to ITC of invoices or debit notes which are received after the end of the financial year beyond September month and not ITC Claimed in a belated return filed after such date. 
3. Also, ITC under Section 16(4) is the nature of tax paid at the stage of purchase of goods or services are vested rights under Article 300A of the Constitution of India and, therefore, to be adjusted with the tax payable on sale of goods or services both in computing the tax liability. 
4. Conditions given under Section 16(4) of the CGST Act are merely procedural in nature and cannot override the substantive conditions given under Section 16(1) and 16(2) of the said Acts.
5. Provision of Section 16(4) imposes unreasonable and disproportionate restriction on the right to freedom of trade and profession guaranteed under Article 19(1)(g) and it, therefore, violates Article 300A of the Constitution.
6. Further, disallowing ITC under Section 16(4) of the CGST Act amounts to double taxation and, thus, violates the principle of taxation on value addition. 

5. Contention of the Respondent

The Respondent contended that:

1. ITC is a benefit extended to a registered person under the CGST which can be availed only as per the scheme of the CGST Act.
2. Further, conditions given under Section 16(4) of the CGST Act is mandatory in nature for availing ITC under Section 16 of the Act. 
3. Payment of ITC at the time of purchase and supply to its supplier remains in the credit ledger of the dealer until the dealer discloses the transaction by way of filing return in Form GSTR- 3B. The amount of ITC is credited into the dealer’s electronic ledger and the same does not reach the Government until the dealer files its return and once the dealer files its return in Form GSTR-3B the amount of input tax lying in the credit ledger of the dealer reaches the Government Treasury. 
4. This is the reason why the Legislature has made such a provision under Section 16(4) of the CGST Act to prevent a dealer from filing the delayed return. 

6. Analysis and Findings by the Hon’ble High Court

Hon’ble Patna High Court made following discussion and interpretations:

a. Section 16(4) is not validation of Article 300-A of Constitution of India

• 一个核心问题是，进项税额抵扣（ITC）本身是否属于既得权利，以及《CGST法案》第16(4)条对其的拒绝是否构成对宪法第300-A条所保障的财产权的侵犯。
• 宪法第300-A条下的财产权既是人权也是宪法权利，非经法律规定不得剥夺。
• 最高法院在Jilubhai Nanbhai Khachar & Ors. 诉古吉拉特邦政府案（1995 Supp (1) SCC 596）中解释道：
  • 财产是法律保障和保护的一系列权利的总和。
  • 它涵盖了各种有价值的权利和利益，特别是所有权、对某物的排他性权利、以任何合法方式处置、占有、使用该物以及排除他人干扰的权利。
• 此外，法律解释的基本原则在于探求立法意图。法定解释的一项基本规则是，当条文清晰、不存在晦涩或歧义且立法意图表达明确时，法院无权修改或变更法定条款。
• 根据《CGST法案》第16条的表述，每一注册纳税人均有权就其为经营业务而使用或拟使用的商品或服务（或两者）所支付的进项税额进行抵扣，该金额应计入其电子抵扣账簿。然而，此项ITC抵扣权受以下条件限制：
  • 所规定的条件和限制，以及
  • 第49条规定的方式

• 第16(2)条为非限制性条款，明确规定除非注册纳税人满足该条(a)至(d)项下的要求和条件，否则无权进行ITC抵扣。
• 《CGST法案》第16(4)条明确规定，注册纳税人不得在下一财年11月30日（修订后）之后或提交相关年度申报表之日（以较早者为准）起，就任何发票或借记单申请ITC抵扣。
• 《CGST法案》第16条的措辞不存在歧义，明确规定ITC的授予须符合其项下的条件和限制。
• 此外，ITC并非无条件享有，注册纳税人仅在满足必要条件且第16(4)条规定的限制不适用的情况下，方有权获得ITC。
• 第16(4)条规定了注册纳税人获得ITC资格的条件之一。因此，注册纳税人根据第16(1)条享有ITC的权利，仅在满足该条件时才成为既得权利。
• 个人援引宪法第300-A条，必须同时满足以下两种情况：
  • 个人财产被剥夺
  • 缺乏法律依据

• 在Jayam and Company 诉助理专员案（(2016) 15 SCC 125）中，最高法院维持了《2006年泰米尔纳德邦增值税法》第19(20)条的合宪性，并裁定：
  • 凡法律赋予的优惠，必须严格遵守附带条件方可享受。
  • ITC并非“经销商”的固有权利，而是根据第19条授予的优惠。
• 根据《CGST法案》第16(1)条，第16(4)条的规定是注册纳税人获得ITC资格的条件之一。
• 因此，不能认为《CGST法案》第16(4)条违反了印度宪法第300-A条。

b. 第16(4)条不违反《CGST法案》第302条（限制宪法第19(1)(g)条下的贸易和职业自由权）

• 请愿人主张，第16(4)条对宪法第19(1)(g)条保障的贸易和职业自由权施加了不合理且不成比例的限制。
• 因此，该条款违反了宪法第302条，并与宪法第13条相抵触。
• 对所有注册纳税人统一适用的法律，不能被视为违反宪法第19(1)(g)条。

7. Conclusion

高等法院裁定，《CGST法案》第16(4)条符合宪法，并未违反印度宪法第19(1)(g)条和第300-A条。