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of <h1>Supreme Court Upholds Rule 89(5) CGST Refund Formula for Unutilized Input Tax Credit</h1> <h3>Union Of India & Ors. Versus M/s. Tirth Agro Technology Pvt. Ltd. & Ors.</h3> The SC upheld the validity of Rule 89(5) of the CGST/GST Rules regarding the refund of unutilized input tax credit, rejecting the challenge to the formula ... Refund of unutilized input tax credit as per the formula prescribed in Rule 89(5) of the Central/Gujarat Goods and Services Tax Rules, 2017 - applicability of N/N. 14/2022 dated 05.07.2022 read with Circular dated 10.11.2022 - retrospective or prospective application? - it was held by High Court that 'The Hon’ble Apex Court, in its judgment in the case of Union of India and others Vs. VKC Footsteps India Pvt. Ltd. [2021 (9) TMI 626 - SUPREME COURT], while upholding the validity of Rule 89(5) of the Rules, directed the GST Council to remove the anomalies in the formula held that 'In the present case however, the formula is not ambiguous in nature or unworkable, nor is it opposed to the intent of the legislature in granting limited refund on accumulation of unutilised ITC. It is merely the case that the practical effect of the formula might result in certain inequities.'' HELD THAT:- This is not a fit case for interference. The Special Leave Petition is accordingly dismissed. The Supreme Court, per Hon'ble Justices Manoj Misra and Ujjal Bhuyan, condoned the delay but noted that the earlier High Court judgment in Special Civil Application No. 18317 of 2023 (Ascent Meditech Ltd. vs. Union of India and Others), dated 17.10.2024, which granted relief to respondents, had been challenged before this Court in SLP(C) No.8134 of 2025 and dismissed on 28.03.2025. The petitioner failed to mention this dismissal in the present petition filed in June 2025. Given this factual matrix, the Court held that it is 'not a fit case for interference' and accordingly dismissed the Special Leave Petition. Pending applications were also disposed of.
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