Input tax credit under GST: interim stay granted where purchases, payments and documents supported the claimed credit.

Interim protection was granted against the assessment and appellate orders denying input tax credit under the Uttar Pradesh GST Act, where the petitioners showed purchases from a registered supplier, payment through banking channels, and supporting invoices, bilties and e-way bills. The challenge relied on Section 16, including Section 16(2)(c), to argue that credit could not be denied solely because the supplier allegedly failed to deposit tax. On that prima facie showing, the Court stayed operation of the impugned orders, subject to deposit of 30% of the assessed tax after adjustment of tax already paid.

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Issues: Whether interim protection should be granted against the assessment and appellate orders concerning denial of input tax credit under the Uttar Pradesh Goods and Services Tax Act, 2017.

Analysis: The petition assailed the assessment under Section 74 and the consequent appellate order on the footing that the goods were purchased from a registered supplier, the purchase consideration including tax was paid through banking channels, and the transaction was supported by invoices, bilties and e-way bills. The challenge also invoked Section 16 of the Uttar Pradesh Goods and Services Tax Act, 2017, including Section 16(2)(c), to contend that denial of input tax credit could not rest merely on alleged non-deposit of tax by the supplier. On this showing, the Court found a prima facie case for interim protection.

Conclusion: Interim stay was granted against operation of the impugned orders, subject to deposit of 30% of the assessed tax after adjustment of tax already deposited.

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