Himachal Pradesh HC Waives off Late Fee for GSTR-9 & 9C Filed Before Amnesty Notification

The Himachal Pradesh High Court has ruled that taxpayers who filed their Goods and Services Tax (GST) annual returns (GSTR-9 and GSTR-9C) before the amnesty notification date are still eligible for a waiver of late fees. The relevant GST amnesty scheme notification mentions that the late fee waiver benefit only applies to taxpayers who file within the stipulated time. However, the court observed that the primary intent of the amnesty scheme was to promote tax compliance rather than penalise taxpayers for late filings. This judgment comes as a relief to taxpayers who submitted their returns before the notification but were denied amnesty benefits.

Key Points:

• Extension of Amnesty Scheme: The Himachal Pradesh High Court ruled that taxpayers who filed GSTR-9 and GSTR-9C before the amnesty notification date (Notification No. 07/2023)   are also eligible for a late fee waiver.
• Intent of the Scheme: The court emphasized that the purpose of the amnesty scheme was to promote tax compliance rather than penalize taxpayers for late filings.
• Court's Decision: The court ruled cancelled the late fee demand of ₹12,71,754 and directed the authorities to pass a fresh order extending the amnesty benefit.
• Implications for Taxpayers: The ruling provides relief for businesses and individuals who filed returns before an amnesty notification but were denied the late fee waiver, reinforcing fair implementation of tax amnesty schemes.
• Legal Protection for Taxpayers: The case highlights the role of courts in ensuring government policies encourage voluntary compliance rather than unfairly penalizing taxpayers.

What Happened?

The case was brought before the court by a pharmaceutical company registered under GST. The company faced financial distress and belatedly filed its GSTR-9 and GSTR-9C returns on March 13, 2023. However, the amnesty notification was issued later, on March 31, 2023, and applied to returns filed between April 1, 2023, and June 30, 2023. Subsequently, a show-cause notice was issued to the company on August 22, 2023, imposing a late fee of ₹12,71,754.

The authorities argued that the amnesty scheme was only applicable to returns filed within the stipulated period and did not cover returns filed before the notification date. The Company contended that the amnesty’s objective was to encourage compliance and should also extend to those who voluntarily filed before the notification was issued.

Court’s Decisions On GSTR-9 & 9C Late Fee Waiver

A Himachal Pradesh High Court order provided relief to a taxpayer, stating that denying the benefit of the GST amnesty scheme based on the GSTR-9 & 9C filing date would be unfair. The court highlighted that the scheme was introduced to reduce compliance burdens, not to penalize those who had already made an effort to file their returns. The taxpayer was granted relief under the GST Amnesty scheme. And, The court cancelled the late fee demand of ₹12,71,754, recognizing that the notification aimed to support compliance.

What does it mean to Taxpayers?

This ruling is important because it confirms that tax amnesty schemes should be fair to everyone. For businesses and individuals in similar situations, this decision provides strong legal support to challenge late fees if they filed their returns before the amnesty but were not included in its benefits. 

Are You Eligible for the GST Amnesty Scheme?

Understanding whether you qualify for the GST Amnesty Scheme is necessary to avail of the late fee waiver benefit. If you have pending returns or need assistance in availing the benefits, consult with IndiaFilings experts. Our professionals can help you file your GSTR-9 and GSTR-9C before the deadline and maximize your compliance benefits. Contact us now to avoid unnecessary penalties!

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