Input Tax Credit cannot be denied for delayed return filing where retrospective GST relief restores the substantive entitlement.

Retrospective insertion of GST provisions restoring Input Tax Credit meant that credit could not be denied solely because returns were filed late. The court treated the entitlement as substantive rather than defeated by a procedural default, and held that the demand order could not stand without reconsideration on merits in light of the governing circular and rectification mechanism. The impugned order was set aside and the matter was remitted for fresh examination, with liberty to seek rectification according to law.

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Issues: Whether denial of Input Tax Credit for delayed filing of returns could stand after the retrospective insertion of Sections 16(5) and 16(6) of the GST enactments, and whether the impugned demand order required interference.

Analysis: The order denying Input Tax Credit was prima facie founded on delayed filing of returns. The retrospective statutory intervention restoring Input Tax Credit, together with the departmental circular clarifying the entitlement and the special rectification procedure, showed that the benefit was substantive and could not be denied merely for a procedural default. The demand was therefore not sustainable without reconsideration on merits, and the matter required fresh examination de hors the procedural objection.

Conclusion: The impugned order was set aside and the matter was remitted to the respondent for fresh consideration on merits, with liberty to the petitioner to seek rectification in accordance with law.

Ratio Decidendi: A substantive Input Tax Credit entitlement created by retrospective GST legislation cannot be denied solely on account of procedural delay in filing returns, and such matters must be reconsidered on merits in light of the governing circular and rectification mechanism.

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