Calcutta High Court orders reconsideration of GST appeal rejected for want of proper CA certificate with UDIN

The Calcutta High Court in Iliyash Sekh Vs Assistant Commissioner of CGST and C. EX, Malda Division & Ors. examined the legality of an appellate order dated 25th September 2024 passed under Section 107 of the **CGST Act, 2017/WBGST Act, 2017. The appellate authority had upheld an adjudication order dated **31st December 2023** issued under Section 73` of the same enactment, primarily due to alleged discrepancies in GST returns and non-furnishing of specified supporting documents, including a Chartered Accountant’s certificate bearing UDIN.

As the dispute revolved around the validity of the appellate process and the assessee’s opportunity to substantiate its position with a proper Chartered Accountant’s certificate, the High Court focused on procedural fairness rather than adjudicating the merits of the tax demand itself.

Background of the dispute

Adjudication and appellate proceedings

  • An adjudication order dated 31st December 2023 was passed against the assessee under Section 73 of the CGST Act, 2017/WBGST Act, 2017.
  • The assessee filed a statutory appeal under Section 107 challenging this order.
  • The appellate authority, by order dated 25th September 2024, dismissed the appeal and affirmed the adjudication order.

Basis for dismissal of appeal by the appellate authority

The appellate authority concluded against the assessee on two main grounds:

  1. Unexplained variance in returns
    It recorded that there was a “difference in GSTR-1 and 3B recorded in GSTR-9C” and that no satisfactory explanation or justification for this difference had been provided by the assessee.

  2. Adverse inference due to non-furnishing of documents
    The authority drew an adverse presumption against the assessee, stating that despite having been given an opportunity, the assessee did not submit:

    • Certificate of Chartered Accountant with UDIN
    • GSTR-9
    • GSTR-9C

On this basis, the appellate authority chose to confirm the adjudication order in full.

Assessee’s submissions before the High Court

Error in GSTR-1 and its claimed rectification

Counsel for the assessee argued that:

  • For February of Financial Year 2017-18, the details of outward supplies were correctly reported in Form GSTR-1.
  • For March of Financial Year 2017-18, there was an error in the outward supplies reported in Form GSTR-1.
  • This error, according to the assessee, was subsequently corrected:
    • In Form GSTR-3B for March (Financial Year 2017-18), and
    • In the annual return in Form GSTR-9 for the same financial year.

Thus, the assessee claimed that the apparent mismatch between GSTR-1 and GSTR-3B was merely the result of a reporting error which had already been rectified in later filings, including the annual return.

Chartered Accountant’s certificate and UDIN issue

On the crucial aspect of the Chartered Accountant’s certificate, the assessee’s counsel pointed out that:

  • A certificate dated 19th February 2024 issued by a Chartered Accountant had in fact been produced before the appellate authority (copy placed at page 77 of the writ petition).
  • However, the appellate authority ignored this certificate solely because UDIN was not mentioned on it.

Subsequently, the assessee obtained:

  • A fresh certificate with UDIN from the same Chartered Accountant, which was placed on record before the High Court as Annexure P-7 (page 122 of the writ petition).
  • The assessee contended that this certificate adequately explained the differences between GSTR-1, GSTR-3B, and the annual return.

On this basis, the assessee sought a remand so that the appellate authority could reassess the matter in light of the correct and complete documentation now made available.

Position on GSTR-9 and GSTR-9C

The assessee further argued:

1.