2025 (1) TMI 1195 - HC - GST

Denial of input tax credit on the basis of Section 16(2)(c) and Section 16(4) of the CGST/SGST Acts - HELD THAT - There will be a direction to the 1st respodnent to consider the observations in the judgment in M. Trade Links case 2024 (6) TMI 288 - KERALA HIGH COURT and extend the benefit of the directions issued in that case to the petitioner also if the factual situation is similar. As regards the claim of the petitioner for input tax credit denied as per 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 case. To enable the consideration of the matter as directed above Ext.P4 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 first respondent shall endeavour to pass fresh orders as directed above within a period of two months from the date of receipt of a certified copy of this judgment. Petition disposed off.

Summary

Case Summary: Kerala High Court Judgment

Court: Kerala High Court
Judge: The Honourable Mr. Justice Bechu Kurian Thomas
Parties:
- Appellant: Represented by Advs. K. Krishna, Achyuth Menon, and Nirmal Krishnan
- Respondent: Represented by Smt. Jasmin M.M. (GP)

Legal Issue: The petitioner challenges the denial of input tax credit under Section 16(2)(c) and Section 16(4) of the CGST/SGST Acts.

Petitioner's Argument:
- The petitioner claims entitlement to input tax credit if the directions from the case "M. Trade Links V. Union of India (2024 KLT Online 1624)" are applied.
- The petitioner is unable to trace suppliers to benefit from the Circulars mentioned in the "M. Trade Links" judgment.

Court's Analysis and Decision:
- The court acknowledges the petitioner's inability to trace suppliers and considers the petitioner's request for input tax credit under Section 16(2)(c).
- The court directs the first respondent to consider the observations from the "M. Trade Links" case and apply its directions to the petitioner if the facts are similar.
- The court sets aside the Ext.P4 order to the extent it denies credit under Sections 16(2)(c) and 16(4) of the CGST/SGST Acts.
- The first respondent is instructed to issue fresh orders within two months, considering the Circulars referred to in Paragraph No.101 of the "M. Trade Links" case.
- The petitioner must produce relevant documents within one month to claim the benefits of the Circulars; failure to do so will forfeit this entitlement.

Disposition: The writ petition is disposed of with the aforementioned directions.