2023 (10) TMI 859 - HC - GST

Input Tax Credit (ITC) - Period of limitation u/s 16(4) - The Petitioner has filed writ petition challenging the show cause notices in DRC-01s issued by both Central tax and State tax authorities for denial of input tax credit availed on reverse charge basis by relying on Section 16(4) of the CGST Act. After the decision of Supreme Court in the case of Northern Opertaing Systems, the Petitioner discharged IGST on the payments made to seconded employees/ related entities and availed input tax credit of the IGST paid. The Tax Department sought to deny the input tax credit by applying the time limit under Section 16(4) of the CGST Act, besides demanding interest and penalty. The Department also sought to demand interest for delayed payment of IGST. The Petitioner inter alia contested the applicability of Section 16(4) of the CGST Act to reverse charge payments made by recepient of taxable supply. The Hon ble High Court has in the attached Order granted stay of adjudication of the show cause notices in DRC-01s issued by the Central tax and State tax authorities.

Summary

The Karnataka High Court granted an interim order in response to Show Cause Notices issued to the petitioner regarding GST returns filed after a Supreme Court decision. The respondents have the option to seek vacation of the interim order. Various authorities were called upon to accept notice in the case.