ITC cannot be denied due to wrong address and GSTN on invoices

The Delhi High Court has ruled that Input Tax Credit (ITC) should not be denied solely because an invoice contained an incorrect address and GSTN for the recipient. In a case involving B Braun Medical India (P.) Ltd., the court found that the supplier had inadvertently used the wrong GSTN on the invoices. Despite this error, the court recognised that the petitioner was a Delhi-based company and no other entity had claimed ITC on these purchases. The court set aside the demand order, allowing the ITC and highlighting that minor clerical errors by suppliers should not penalise businesses.

The Hon'ble Delhi High Court in the case of B Braun Medical India (P.) Ltd. v. Union of India [W.P.(C) 114 of 2025 dated March 12, 2025] set aside the order wherein a demand order was passed on the Assessee was claiming excess Input Tax Credit ("ITC"), where invoices were raid by the supplier for purchase of products inadvertently a different address and GSTN.

Facts:

M/s B Braun Medical India (P.) Ltd. ("the Petitioner") was engaged in the sale of various pharmaceutical products and medical devices. The Petitioner had purchased a large quantum of products from M/s. AhlconParenterals (India) Limited ("Ahlcon") on the basis of various purchase orders.

It is stated that the invoices for the said products were raised by Ahlcon on the Petitioner, however, the said invoices inadvertently reflected the Bombay address and Bombay GSTN of the Petitioner, instead of the Delhi GSTN number. This has led to the impugned demand.

The Petitioner relied upon the purchase orders and invoices, to submit that, the Petitioner is clearly a Delhi based company and incorrect reflection of Petitioner's Bombay GSTN on the invoices was merely an error by the supplier.

However, the Department had taken a stand that the Petitioner is not entitled to the ITC and has accordingly, passed the Order dated June 28, 2024 ("the Impugned Order").

Hence, aggrieved by the Impugned Order, the Petitioner filed the present writ petition.

Issue:

Whether ITC can be denied die to wrong address and GSTN on invoices?

Held:

• Opined that,the Petitioner's name is correctly mentioned in the invoices, however, the wrong GST number, i.e., of the Bombay office has been mentioned. On this issue, there is no stand taken by the Department in the counter affidavit. On a direct query being put to the ld. Standing Counsel for the Respondent, he fairly admitted that no other entity has also claimed at ITC on these purchases. The only basis for rejecting the ITC is the mention of the Bombay office GSTN instead of the Delhi office GSTN. Substantial loss would be caused to the Petitioner if the credit is not granted for such a small error on behalf of the supplier.
• Observed that, if the correction in the invoices is permitted and the Petitioner is provided the ITC, the challenge to the constitutional validity shall not be pressed by the Petitioner. Hence, the Impugned Order rejecting ITC was set aside. Hence, the petition was disposed of.

Our Comments:

In pari materia case of M/s Shree Krishna Traders v. State of UP and Another [Writ Tax No. 1106 of 2023 dated September 25, 2023], the Hon'ble Allahabad High Court held that as per circular no. 183/15/2022-GST dated December 27, 2022, in cases where the supplier has filed Form GSTR-1 as well as return in Form GSTR-3B for the tax period, but has declared the supply with the wrong GSTIN of the recipient in the Form GSTR-1, the procedure provided under the circular is to be complied with when there is a difference in ITC claimed by the registered person in his return form in Form GSTR-3B and ITC is available in Form GSTR-2A. The proper officer of the actual recipient shall intimate the concerned jurisdictional tax authority of the registered person, whose GSTIN has been mentioned wrongly, that ITC on those transactions is required to be disallowed if claimed by the recipient in the Form GSTR-3B. However, the allowance of ITC to the actual recipient does not depend on the completion of the action by the tax authority of such registered person, and such action should be pursued as independent action

This case highlights that minor errors in GSTN mention on invoices should not automatically disqualify a company from availing of ITC. The focus should be on the overall correctness of the transaction details and the absence of any fraudulent claims.

OFFICIAL JUDGMENT COPY HAS BEEN ATTACHED