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ITC accrued as on 30.6.2017─Curtailing the rights of assessees by carrying out the retrospective amendments in S.140 by introduction of time limit for its claiming

OmPrakash jain
GST Act Amendment Sets Time Limit on ITC Claims, Challenging Past Court Rulings and Sparking Legal Debates The retrospective amendments to Section 140 of the GST Act, effective from July 1, 2017, impose a time limit on claiming Input Tax Credit (ITC), which was previously considered an accrued vested right under Article 300A of the Constitution. This move by the Central Board of Indirect Taxes and Customs (CBIC) has been criticized for overturning favorable court judgments and denying rightful claims, despite no financial loss to the government. The amendments are seen as a revenue-focused approach, leading to unnecessary litigation and public harassment. Legal recourse may still be possible under constitutional provisions and past court rulings. (AI Summary)

The Ratio decidendi of Supreme court and various High courts that;

“Input Tax/CENVAT Credit which has been accrued in Erstwhile Law prior to introduction of GST, is a Accrued Vested Right and Property of the Assessee under Article 300A of the Constitution”,

has been annulled after the retrospective amendments in S.140 w.e.f. 1.7.2017 by inserting the words ‘within such time and’,

Therefore until and unless the retrospective amendments in S.140 is stayed &/or declared ultra virus by the Judiciary, the provisions of Limitation Act will not prevail since taxing statutes are to be interpreted literally as per Supreme Court case of The State of Karnataka v. M.K. Agro Tech Pvt. Ltd.  2017 (9) TMI 1308 - SUPREME COURT .

It is Draconian step on the part of CBIC, who has carried out retrospective amendments in S.140, leave apart many decided cases in favour of the taxable persons. inspite of no loss to the Government in carry forward of accrued ITC, the amendments in S.140, w.e.f. 1.7.2017, is a result of some egoistic bureaucrats adopting only revenue oriented approach reflected in their working. They are adamant in denying the rightful claim of the assessees. It has been observed in the past that every time, the fair judgments of various courts in GST are being turned down by CBIC, by bringing amendments in Act and/or rules. The Govt. is wasting lot of public money in unwanted litigations, which lead to harassing the public at large.

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CA Om Prakash Jain, Jaipur, 9414300730, [email protected]

Goods and Services Tax - GST
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