The Calcutta High Court has made a significant ruling regarding the Goods and Services Tax (GST) in the case of Kuddus Ali v. Assistant Commissioner of Central Tax. The court decided that a discrepancy between Form GSTR-1 (outward supplies details) and Form GSTR-3B (monthly return) doesn't automatically allow for direct tax recovery under Section 75(12) of the CGST Act. *Key Points:* - *Section 75(12) Applicability*: This section applies only when self-assessed tax from GSTR-1 is not included in GSTR-3B. - *Court's Observation*: The court observed that in cases where self-assessed tax from GSTR-1 is included in GSTR-3B, direct recovery under Section 75(12) isn't permissible, even if there are other discrepancies like late fees and interest. - *Procedural Requirements*: The department must follow procedures outlined in Sections 65, 66, 67, 73, or 74 of the CGST Act, which include issuing a proper show cause notice (SCN), when an explanation provided by the taxpayer is deemed unacceptable. - *Ruling's Impact*: This ruling clarifies that for direct recovery under Section 75(12), the self-assessed tax from GSTR-1 must be genuinely missing from GSTR-3B, not just subject to other discrepancies or delayed payments. *Implications for Taxpayers:* - Taxpayers should ensure accurate reconciliation of their GSTR-1 and GSTR-3B returns to avoid potential disputes. - In cases of discrepancies, taxpayers can respond to the initial Form ASMT-10 notice, and the department must follow due process before making any recoveries. *Takeaway:* The Calcutta High Court's ruling emphasizes the importance of following due process and adhering to procedural requirements under the CGST Act. Taxpayers and tax authorities must carefully consider the applicability of Section 75(12) and ensure that any recoveries are made in accordance with the law . "Share this update with others and stay updated by following the WhatsApp channel!" *Follow the VEM : VAPS®-EPSCON-MKJ channel on WhatsApp:* https://whatsapp.com/channel/0029Va555c5JJhzdOhLadx3B