Input tax credit cannot be restricted division-wise absent express statutory authority, preserving cross-unit set-off entitlement.

In the absence of an express statutory provision, input tax credit cannot be restricted division-wise so as to prevent set-off against output tax payable across a taxpayer's units. Where the assessee held a common registration and claimed credit on a consolidated basis, the authority could not impose a matching rule that confined utilisation to the particular division where inputs were used. The operative effect is that credit must be computed and adjusted in accordance with the taxpayer's lawful entitlement, without an unauthorised divisional limitation.

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Issues: Whether input tax credit could be restricted division-wise so as to deny the assessee the benefit of adjustment against output tax payable in other divisions.

Analysis: The assessee had a common registration for all divisions and claimed input tax credit on a consolidated basis. The Tribunal sustained a division-wise restriction mainly by relying on the advance ruling and on the view that inputs used in a particular division could be matched only with the output of that division. The Court held that the earlier binding precedent had already ruled that, in the absence of any statutory provision authorising such a restriction, the assessing authority cannot impose a division-wise method of computation that curtails the assessee's entitlement to utilise input tax credit across its units.

Conclusion: The restriction of input tax credit to a particular division was not lawful, and the assessee was entitled to claim the benefit without such limitation.

Final Conclusion: The impugned order was set aside and the matter was sent back for fresh computation of input tax credit in accordance with the Court's view.

Ratio Decidendi: In the absence of an express statutory provision, an assessing authority cannot restrict the utilisation of input tax credit division-wise or impose a method of adjustment that diminishes the assessee's lawful entitlement.

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