Judicial Precedents for where constructive delivery was held to be enough satisfaction under S 16(2)(b) of CGST Act, 2017 to claim ITC, Goods and Services Tax - GST

[Gautam Godhwani]

By virtue of Section 16(2)(b) wherein entitlement of ITC by a registered person is established only when he has received goods and services or both.

What is construed as ‘received’ has not been defined under the GST Law – whether physical delivery of such goods is required or a symbolic or constructive delivery by transfer of title and thereby transfer of risks and rewards of ownership shall also suffice.

It would be highly appreciated wherein the cases for the latter condition could be given - AKA ITC being allowed from the moment risk in goods has been passed or constructive delivery has taken place instead of actual delivery being the requisite norm, be it of this regime or the previous one.

These would be on the lines of S 19, S 20 and S 26 of SOGA.

One such case is of Automative Components Technology India Private Limited - 2020 (3) TMI 242 - AUTHORITY FOR ADVANCE RULING, TAMILNADU in AAR Tamil Nadu Order No. 05/ARA/2020 dated 31.01.2020. Another could be the case of the four member bench of Hon’ble Supreme Court in the case of Duni Chand Rataria vs. Bhuwalka Brothers Ltd.: 1954 (12) TMI 19 - SUPREME COURT has interpreted that delivery to mean and include “constructive delivery” as well.

Thanks and Regards,

Gautam.

Posts / Replies

[KASTURI SETHI]

Sh.Padmanathan Kollengode Ji,

The concept of 'constructive delivery' has been discussed in detail in the judgement of Supreme Court in the case of COMMERCIAL TAXES OFFICER Versus BOMBAY MACHINERY STORE - 2020 (4) TMI 769 - SUPREME COURT.

[Amit Agrawal]

In the case of COMMERCIAL TAXES OFFICER Versus BOMBAY MACHINERY STORE - 2020 (4) TMI 769 - SUPREME COURT, following observations of Apex Court are worth noting:

"15. ................................................ In the event, the authorities felt any assessee or dealer was taking unintended benefit under the aforesaid provisions of the 1956 Act, then the proper course would be legislative amendment. The Tax Administration Authorities cannot give their own interpretation to legislative provisions on the basis of their own perception of trade practise. This administrative exercise, in effect, would result in supplying words to legislative provisions, as if to cure omissions of the legislature."

These are ex facie views of mine and the same should not be construed as professional advice / suggestion.