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2025 Supreme(Mad) 2770
IN THE HIGH COURT OF JUDICATURE AT MADRAS
KRISHNAN RAMASAMY, J.
Groz-Beckert Carding India Pvt. Ltd.- Appellant
Versus
The Assistant Commissioner of GST & Central Excise - Respondent
W.P.Nos.6012 & 6014 of 2025 and W.M.P.No.6616 of 2025
Decided on : 02-04-2025
Advocate Appeared:
For the Appellant : Mr.Pulkit Verma for Mr.V.Veeraraghavan
For the Respondents: Mr.Sai Srujan Tayi, Senior Panel Counsel assisted by Ms.Pooja Jain, Junior Panel Counsel
Court affirmed that taxpayers can claim input tax credit beyond usual deadlines if delays arise from legitimate challenges, as evidenced by amendments to the GST Act.
Headnote:(A) Goods and Services Tax Act, 2017 - Section 16(4) and Section 16(5) - Challenge to rectification order regarding input tax credit (ITC) claims - Court quashed the impugned orders directing to allow ITC claims within the deadline specified in Section 16(5), due to the Covid-19 lockdown and other difficulties faced by petitioners. (Paras 10.1 and 10.2)
(B) Legal principles of tax law - The court reinforced the principle that no penal action should be taken against registered dealers who could not file returns in time due to valid reasons like health issues and financial constraints. (Paras 10 and 11)
Facts of the case:
Petitioners challenged orders that reversed their claims for input tax credit alleging delays due to circumstances beyond their control, such as financial constraints from a lockdown and health issues.
Findings of Court:
The court found that the impugned orders were unsustainable due to subsequent amendments that extended the deadline for availing ITC.
Issues: The primary question was whether the petitioners were entitled to input tax credit claims despite delays caused by valid circumstances.
Ratio Decidendi: The court ruled that subsequent amendments to the GST Act allowing extension for availing ITC with retrospective effect took precedence over previous limitations imposed, thus quashing the earlier orders.
Result: Writ Petitions allowed.
| Table of Content |
|---|
| 1. challenge to earlier orders regarding itc (Para 2 , 5) |
| 2. previous court decision applicability (Para 3 , 4) |
| 3. final order allowing petitions (Para 6) |
ORDER :
Heard Mr.Pulkit Verma learned counsel appearing for the petitioner and Mr.Sai Srujan Tayi, learned Senior Panel Counsel assisted by Ms.Pooja Jain, learned Junior Panel Counsel who takes notice on behalf of the respondent. With consent, the main Writ Petitions are taken up for final disposal at the stage of admission itself.
2. The challenge in this Writ Petition is to the order-in-original dated 14.08.2024 and the rectification order dated 28.01.2025 passed by the first respondent and to quash the same and to remand the matter back for denovo adjudication.
3. At the threshold, learned counsel appearing for the petitioner would submit that the issue involved in the Writ Petitions is no longer res integra, as it has already been decided by this Court in a batch of Writ Petitions, viz., in W.P.No.25081 of 2024, etc dated 17.10.2024. Therefore, the learned counsel prays that the benefit of the said order dated 17.10.2024, may extended to the petitioner herein as well.
4. The learned Senior Panel Counsel for respondents also fairly conceded that the issue involved in the Writ Petitions is covered by the decision relied on by the petitioner.
5. Considering the fact that the legal issue involved in the Writ Petitions has already been dealt with by this Court in a batch of Writ Petitions, viz., in W.P.No.25081 of 2024, etc dated 17.10.2024, this Court is inclined to dispose of the present Writ Petitions on the same lines. For better appreciation, the operative portion of the said decision is as follows:-
''9. The petitioners in all these Writ Petitions are registered dealers on the files of the respondent- Department under the provisions of the Goods and Service Tax Act, 2017/CGST Act 2017. Though the petitioners have filed GSTR-1 returns in time, however, insofar as claim of ITC is concerned, since the petitioners were faced with certain difficulties, such as Financial constraints (as there was complete lockdown due to outbreak Covid-19) health related ailments, fire accidents, they were unable to file GSTR-3B returns, which resulted them in not being able to claim ITC in time before the prescribed date. Whereas, the respondent-Department, without considering such vital aspects and that reasons for the delay is not deliberate, issued the show cause notices to the petitioners, proposing to reverse the ITC availed and went to the extreme level of confirming the proposals contained in the show cause notices by passing the impugned orders,whereby, the claim made by the petitioners for ITC was reversed and the petitioners have been directed to tax/penalty/interest. Aggrieved against the impugned orders, the petitioners are before this Court by way of present Writ Petitions seeking for setting aside the impugned orders.
10. After the filing of these Writ Petitions, certain development took place, i.e. that 53rd GST Council Meeting was held on 22.06.2024, and during the said Meeting, the GST Council recommended for extension of the deadline for availing ITC on any invoice or debit note under Section 16(4) of the CGST Act and this extension would be applicable to any GSTR-3B returns filed for the Fys 2017-18, 2018-19, 2019-20 and 2020-21 with a new deadline deemed to be as ''30.11.2021'', to which, the Presidential Assent was also obtained by the Government of India on 16.08.2024, whereby, the financial proposals of the Central Government for the Financial Year 2024-25 was given effect to vide Finance Act, (No.2) of 2024, and in view of the aforesaid enactment, the Ministry of Finance (Department of Revenue) Central Board of Indirect Taxes and Customs, issued a Notification, bearing No.17 of 2024-Central Tax, dated 27.09.2024, pursuant to which, a Circular No.237/31/2024-GST was issued by the Central Board of Indirect Taxes and Customs, which was addressed to all the Principa
