AAR Denies Ruling on Erroneous GST ITC Adjustment and Refund
The present advance ruling has been filed by a company named M/s. Auto Color Paints (appellant) before the Tamil Nadu State Appellate Authority for Advance Ruling, Chennai, under Sub-Section (1) of Section 100 of the CGST Act 2017/TNGST Act 2017. The company has a registered address at No. 182 E4/15, S.P.Р Building, S.N. High Road, Tirunelveli – 627 001.
The appellant is a dealer of PPG Asian Paints and is registered under GST, possessing GSTIN 33ABBFA7732P1Z8. The appellant claimed that they were a dealer for M/s. PPG Asian Paints and received purchase bills from them. However, they mistakenly reported these purchase bills as sales bills in their GSTR-1 returns and also paid GST on them during the period from 2017-18 to 2022-23. Because of this mistake, the Input Tax Credit (ITC) they had claimed from these purchase bills was incorrectly returned to them through the GSTR-1 returns they filed.
The applicant further mentioned that there are no actual invoices or goods transfers for the Auto Color Paints. They requested that their outstanding balance be corrected to include the full ITC credit of Rs. 18,53,429.21 (SGST Rs. 9,26,714.60 and CGST Rs. 9,26,714.60). The applicant also stated that they asked M/s. PPG Asian Paints to adjust the ITC in their books, but M/s. PPG Asian Paints refused to make the change.
Questions Asked by Appellant:
The appellant, M/s. Auto Color Paints, has asked the following questions, seeking the Tamil Nadu Advance Ruling No. 23/ARA/2025, dated July 14, 2025:
“Question 1. ITC credit will be adjusted in the books of accounts – outstanding payable amount?
Question 2. ITC erroneously transfer will be eligible for refund?”
What Did the Ruling Say?
In accordance with the Authority for Advance Ruling, Tamil Nadu No. 207, 2nd Floor, Papjm Building, No. 1, Greams Road, Chennai 600 006, the following answers have been given to the above questions:
The authority has not admitted the advance ruling application filed by the appellant. For this, the Tamil Nadu State Appellate Authority for Advance Ruling, Chennai, gave the reason that the questions as asked by the appellant do not fall under any of the clauses from (a) to (g) of Section 97(2) of the CGST/TNGST Acts, 2017.
Citation: M/s. Auto Color Paints (AAR Tamil Nadu); No. 23/ARA/2025; 14/07/2025
