2025 (1) TMI 111 - HC - GST

Denial of input tax credit has been denied to the petitioner on account of the provisions contained in Section 16(2)(c) and Section 16(4) of the CGST/SGST Acts - HELD THAT - The writ petition will stand disposed of, directing the 1st respondent to consider the directions issued by this Court in the judgment in M. Trade Links 2024 (6) TMI 288 - KERALA HIGH COURT and to extend the benefit of the directions issued in that case to the petitioner, if the factual situation of the petitioner is similar. In so far as the claim of the petitioner for input tax credit, which has been denied to the petitioner in terms of the provisions contained in Section 16(2)(c) of the CGST/SGST Acts is concerned, it is directed that the claim of the petitioner shall be considered in terms of the Circulars referred to in Paragraph No.101 of M. Trade Links. To enable the consideration of the matter, Ext.P1 order will stand set aside to the extent it denies credit on account of the provisions contained in Section 16(2)(c) and Section 16(4) of the CGST/SGST Acts. The writ petition ordered.

Summary

In the judgment by the Kerala High Court, the petitioner challenges the denial of input tax credit under Sections 16(2)(c) and 16(4) of the CGST/SGST Acts. The petitioner argues that the guidance from the case M. Trade Links v. Union of India should apply, potentially allowing the petitioner to claim the denied input tax credit. The court directs the respondent to assess the petitioner's situation in light of M. Trade Links, extending its benefits if applicable. The court also instructs that the petitioner's claim under Section 16(2)(c) be reconsidered per the relevant Circulars cited in M. Trade Links. Consequently, the existing order denying credit based on Sections 16(2)(c) and 16(4) is set aside, with a directive for the respondent to issue new orders within two months. The petitioner must submit necessary documents within one month to maintain eligibility for the Circulars' benefits.