Belated input tax credit claims under GST may need fresh adjudication in light of the proposed amendment.

Demand based on belated return filing and partial expiry of input tax credit was treated as requiring reconsideration because the order was passed before the notice and the proposed GST amendment in Finance (No. 2) Bill, 2024 was relevant to regularisation of delayed ITC availment. The Madras HC set aside the impugned order and remitted the matter for fresh adjudication on merits in accordance with law after enactment of the amendment. The text indicates that Sections 16(5) and 16(6) were proposed to address delayed availment of input tax credit, and the controversy was to be reconsidered in that light.

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Issues: Whether the demand confirmed by invoking Section 18(2) on the basis of belated filing of returns and partial expiry of Input Tax Credit could be sustained, and whether the matter required fresh consideration in view of the proposed amendment to the GST law.

Analysis: The demand arose from the petitioner's belated returns after restoration of registration, resulting in partial expiry of Input Tax Credit. The order was noticed to have preceded the notice issued to the petitioner. The pending legislative proposal in the Finance (No.2) Bill, 2024 to regularize delayed availment of Input Tax Credit by inserting Sections 16(5) and 16(6) of the CGST Act, 2017 was treated as relevant to the controversy, and the case was considered fit for the same course adopted in similar matters by setting aside the order and directing fresh adjudication after the amendment is enacted.

Conclusion: The impugned order was set aside and the matter was remitted for fresh decision on merits and in accordance with law after enactment of the amendment to the GST law.

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