PROPOSED AMENDMENT TO SECTION 17[5][d]

[Sadanand Bulbule]

Dear experts

You are aware that recently held 55th GST Council meeting has recommended for an amendment to nullify the judgement of the Hon'ble Supreme Court rendered in the case of Safari Retreat - 2024 (10) TMI 286 - SUPREME COURT case. It reads as under:

Amendment in section 17(5)(d) of CGST Act, 2017

• To align the provisions of section 17(5)(d) of CGST Act, 2017 with the intent of the said section, the Council has recommended amending section 17(5)(d) of CGST Act, 2017, to replace the phrase "plant or machinery" with "plant and machinery", retrospectively, with effect from 01.07.2017, so that the said phrase may be interpreted as per the Explanation at the end of section 17 of CGST Act, 2017.
• My understanding:
• Will it not frustrate the functioning of the judiciary as an independent and constitutional pillar for democracy?
• What was the wisdom and object of the Parliament for enacting the provision of Section 17[5][d] then ?
• This U turn is to flip its own wisdom and object. Whenever the judgement is not palatable, make amendments retrospectively to dampen it. Can greed for revenue overrule such judgement of the Supreme Court?
• Comments plz.

[Sadanand Bulbule]

Dear experts

What would be the fate of the following order of the Supreme Court in view of the retrospective amendment to Section 17[5][d] of the CGST Act with effect from 01/07/20217?

2025 (5) TMI 1684 - SC ORDER - CHIEF COMMISSIONER OF CENTRAL GOODS AND SERVICE TAX & ORS. VERSUS M/S. SAFARI RETREATS PRIVATE LIMITED & ORS.

Condonation of delay - Review petition - Error apparent on the record - Input Tax Credit (ITC) - Constitutional validity of clauses (c) and (d) of sub-section (5) of Section 17 of the Central Goods and Services Tax Act, 2017 - Interpretation of the expression "plant or machinery" in Section 17(5)(d) of the CGST Act - HELD THAT:- Delay condoned.

We have gone through the review petition and perused the Judgment and Order dated 03 October 2024 which has been sought to be reviewed.

There is no error apparent on the record.

Review Petition is dismissed.

No.- REVIEW PETITION (C)NO…. . OF 2025 [Diary No. 1188 of 2025] In Civil Appeal No. 2948 of 2023

Dated.- May 20, 2025

1. Chief Commissioner of Central Goods and Service Tax & Ors. Versus M/s Safari Retreats Private Ltd. & Ors. - 2024 (10) TMI 286 - Supreme Court

HON'BLE MR. JUSTICE ABHAY S. OKA And HON'BLE MR. JUSTICE SANJAY KAROL

ORDER

In the interest of justice, the defects raised by the Registry are waived.

Delay condoned.

We have gone through the review petition and perused the Judgment and Order dated 03 October 2024 which has been sought to be reviewed.

There is no error apparent on the record.

Review Petition is dismissed.

AI Summary

Input tax credit eligibility narrowed by retrospective amendment to reinstate "plant and machinery" limitation, raising compliance and equity concerns.
The memorandum addresses a proposed retrospective amendment substituting the phrase "plant or machinery" with plant and machinery to restrict input tax credit for goods or services used in construction of immovable property, counter the Supreme Court's Safari Retreat interpretation, and thereby narrow entitlement to ITC; it outlines policy debate over legislative overruling of judicial interpretation, administrative and adjudicatory responses, and calls for possible amnesty to mitigate retrospective liabilities.