Input Tax Credit Dispute Resolved: HC Directs Fresh Order Considering 2024 Finance Bill Amendments for AY 2018-2019

HC allowed the writ petition challenging the Order-in-Appeal regarding delayed Input Tax Credit for AY 2018-2019. The court set aside the original order and remitted the case back to the respondent to issue a fresh order considering proposed amendments in the Finance (No.2) Bill, 2024, relating to GST enactments. No costs were imposed, and connected petitions were closed.

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Issues:
Challenge to Order-in-Appeal regarding delayed availing of Input Tax Credit under GST for AY 2018-2019.

Analysis:
The petitioner challenged Order-in-Appeal No.MAD-CGST-JTC-APP-173-21, dated 25.01.2021, related to delayed availing of Input Tax Credit under Section 16(4) of GST Enactments for AY 2018-2019. The petitioner argued based on Clause 114 of the Finance (No.2) Bill, 2024, reflecting the intention of Parliament to allow, not deny, Input Tax Credit benefits. Conversely, the respondents referred to Clause 146 of the same Bill, suggesting a possible remittance subject to proposed amendments in GST enactments.

The judge noted the submissions and highlighted Clauses 114 and 146 of the Finance (No.2) Bill, 2024, which address the issue. Clause 114 allows Input Tax Credit for specified financial years until November 30, 2021, and Clause 146 restricts refunds if Section 114 had been in force. The judge found it appropriate to interfere, considering the Parliament's actions, and set aside the impugned Order-in-Appeal, remitting the case back to consider the proposed amendments in GST Enactments.

In conclusion, the Order-in-Appeal was set aside, and the case was remitted to the second respondent to issue a fresh order based on the proposed amendments in the GST Enactments as per the Finance (No.2) Bill, 2024. The Writ Petition was disposed of with no costs, and connected Miscellaneous Petitions were closed.

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