Supreme Court disallows Rs 923-crore GST refund to Bharti Airtel

The Supreme Court has disallowed Sunil Bharti-led Bharti Airtel’s claim for goods and services tax (GST) refund of Rs 923 crore, saying such refunds, based on ‘unilateral’ rectification of electronically-filed returns by a taxpayer on a self-assessment basis would lead to a ‘chaotic situation’ and have a cascading effect on the stakeholders in the relevant transaction chain.

A Bench led by Justice AM Khanwilkar, on the tax department’s appeal, set aside the Delhi High Court’s May 2020 order that allowed Bharti to rectify Form GSTR-3B for July to September 2017, saying such directions “cannot be sustained.”

While the tax authorities had denied any refund alleging that the company had under-reported input tax credit during the period, the company claimed it had paid excess tax of Rs 923 crore on inputs based on estimates since the GSTR-2A form was not operational during the error period.