Functionality test under GST input tax credit provisions led to remand for fresh consideration and a speaking order.

The article discusses GST input tax credit disputes under Section 17(5)(c) and 17(5)(d), noting the Supreme Court's functionality test for determining whether a building can qualify as a plant. Applying that framework, the High Court directed a fresh examination of the petitioner's case, requiring the respondents to reconsider the matter after granting a hearing and to pass a speaking order. The impugned notice in Form GST ASMT-10 was set aside and the matter was remanded for reconsideration.

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Issues: Whether the impugned notice in Form GST ASMT-10 should be set aside and the matter remitted for reconsideration after hearing the petitioner in light of the Supreme Court's ruling on the functionality test under Section 17(5)(c) and 17(5)(d) of the GST enactments.

Analysis: The controversy was treated as covered by the Supreme Court's conclusions on the vires of clauses (c) and (d) of Section 17(5) and on application of the functionality test to determine whether a building can qualify as a plant. Instead of deciding the matter finally at this stage, the Court found it appropriate to direct a fresh examination by the respondents and require a speaking order after granting the petitioner an opportunity of hearing.

Conclusion: The impugned notice was set aside and the matter was remanded to the respondents for reconsideration and passing of a speaking order after hearing the petitioner.

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