Diya Agencies v. State Tax Officer

The case of Diya Agencies v. State Tax Officer is an important judgment of the Kerala High Court concerning the denial of Input Tax Credit (ITC) solely on the basis of discrepancies between GSTR-2A and the ITC claimed by the purchasing dealer. The decision reinforces that electronic return mismatches cannot, by themselves, defeat a genuine ITC claim and that tax authorities must undertake an independent verification of the underlying transactions before disallowing credit.

The petitioner, Diya Agencies, claimed Input Tax Credit amounting to ₹44,51,943.08 under the CGST and SGST Acts for the Assessment Year 2017-18.