TaxTMI 
TaxTMI 
TaxTMI 
2025 (10) TMI 785
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....ng the amount of admissible input tax credit shall be made, unless the appellant has been given an opportunity of being heard. 2. Under Section 103(1) of the Act, this Advance ruling pronounced by the Appellate Authority under Chapter XVII of the Act shall be binding only- (a) on the applicant who had sought it in respect of any matter referred to in sub-section (2) of Section 97 for advance ruling; (b) on the concerned officer or the jurisdictional officer in respect of the applicant. 3. Under Section 103 (2) of the Act, this advance ruling shall be binding unless the law, facts or circumstances supporting the said advance ruling have changed. 4. Under Section 104(1) of the Act, where the Appellate Authority finds that advance ruling pronounced by it under sub-section (1) of Section 101 has been obtained by the appellant by fraud or suppression of material facts or misrepresentation of facts, it may, by order, declare such ruling to be void ab-initio and thereupon all the provisions of this Act or the rules made thereunder shall apply to the appellant as if such advance ruling has never been made. At the outset, we would like to make it clear that the provisions of both th....
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.... on import IGST on the basis of a re-assessed bill of entry, is very much governed by the time limit as prescribed under Section 16(4) of the CGST Act, 2017. iv) The time limit for availing ITC on the differential IGST paid would begin from the date of re-assessment of bill of entry. 4.1 Aggrieved over the aforesaid ruling pronounced by the AAR in respect of Query Nos. 1, 2 and 3, the Appellant has filed the instant appeal. Further, the Appellant has stated in the Appeal application filed by them that they are not appealing against the impugned ruling in respect of Query No.4. Under the grounds of appeal, the appellant has stated that - (a) The AAR has erred in holding that neither TR-6 challan as such nor TR-6 challan read with SVB Order and letter issued by the Tax Authority are not valid documents for the purpose of availing the ITC. (b) The AAR has erred in holding that Section 16(4) of the CGST Act is applicable on Bill of Entry. (c) The AAR has erred in not addressing Question No. 2 and not considering that Section 16(4) time limit is also not applicable for TR-6 challan read with SVB Order and Customs Authorities letters. 4.2.1 With respect to the decision regardin....
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....stoms Tariff Act) or under any other law for the time being in force, .................. and includes provisional assessment, self-assessment, re-assessment and any assessment in which the duty assessed is nil. The word "assessment" is used as meaning sometimes the computation of rate of duty, sometimes the assessable value of Service and sometimes the whole procedure laid down under the Act for imposing duty liability upon the manufacturer or importer. The word assessment is, thus, capable of bearing a very comprehensive meaning; in the context, it can comprehend the whole procedure for ascertaining and imposing duty liability [CST Vs Scott Wilson Kirkpatrick (I) Pvt. Ltd., 2011 (23) STR 321 (Kar.)]. For For' used with the active participle of a verb means for the purpose of. For' has many shades of meaning. It connotes the end with reference to which anything is done. It also bears the sense of 'appropriate' or 'adapted to'; 'suitable to purpose' [Indian Chamber of Commerce Vs. C.I.T West Bengal II, Calcutta AIR 1976 SC 348]. The word "for" is used as a function or to indicate purpose or any intended destination or the object towards which the acquisition is directed. Di....
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....ther hand, the re-assessment procedure under Section 28 either at the behest of the proper officer or based on self-ascertainment by the importer, may not lead to generation of a re-assessed bill of entry. Therefore, while both the assessments include assessment of duties (including import IGST), the document may differ. It transpires that it is because of this difference, that Rule 36(1)(d) is phrased in a manner to encompass assessment of Import IGST under both the situations. 4.2.7 It was contended by the appellant that therefore the AAR's findings at para 6.6 of the impugned ruling that Rule 36(1)(d) only covers 'bill of entry', 'courier bill of entry' and 'other declarations/forms' is erroneous as the said provision encompasses both re-assessment by way of bill of entry as well as otherwise. The said findings are also vague as prescription of tax paying documents could not be understood as unspecified forms, and secondly, even in the event of accepting the same, the documents, viz., TR-Challan read with SVB letter and Customs Authorities' letters are nothing but declarations under the Customs Act, and as such ITC should be eligible to the appellant. Thirdly, the finding is al....
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.... intra-state supply which in turn provides for issuance of 'tax invoice' for claiming ITC, the IGST Act vis-à-vis import of goods would not provide for such document. Therefore, what suitable document culminates into assessment and payment of import IGST should be considered as eligible document for availing ITC of import IGST. 4.2.10 The appellant contends that Circular No. 16/2023-Customs dated 07.06.2023 does not apply to the instant case and the reasons as to why it is not applicable has already been discussed in paras B.27 and B.28 of the original application which has not at all been considered by the AAR, who has relied on selective extracts to hold that TR-6 is not an eligible document for availment of ITC. The said circular is not applicable to the instant case, because of the following facts, viz., * The Circular has not provided any reasons for the conclusions at para 5.1 and is without any basis, and therefore the circular has limited applicability and cannot have general application. * The circular cannot override the statutory language of Rule 36(1((d), which prescribes for availing of ITC on "any similar document" prescribed under the Customs Act for the ....
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....4.2.12 The appellant states that ITC is admissible when there is legitimacy of the claim and that the procedural law should be harmoniously interpreted to achieve the object of law. The provisions for allowing credit under the tax statute entails two conditions, one in the nature of substantial conditions and the other of the nature of procedural ones. Accordingly, once substantial conditions are fulfilled, credit is not deniable because of gaps in procedural conditions or if there is lapse in procedural conditions. The appellant states that the said aspect stands reiterated under the following case laws, viz., CCEx Vs Home Ashok Leyland Ltd., [2007 (210) ELT 178 (SC)], Mammon Concast Pvt. Ltd., Vs C.CGST [2021-VIL-247-CESTAT-DEL-ST], CCE Vs Graphite (I) Ltd., [(2007) 212 ELT 54 (Tri. Mum.)]. 4.2.13 The appellant states that even otherwise, upon comparison of provisions of pre-GST regime and GST regime, ITC based on TR-6 challan read with SVB Order and the Customs Authorities' letters is eligible. The appellant furnished a comparison table of the provisions of Rule 9(1) of the CENVAT Credit Rules, 2004, vis-à-vis the provisions of Rule 36(1) of the CGST Rules, 2017. And tha....
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....work. 4.2.15 The appellant states that ITC is a substantive right and the legislative intent paves the way for it. The Hon'ble Supreme Court in UOI Vs Cosmo Films Ltd [2023 (383) ELT 66(SC.)] had observed that "The GST regime is based on the idea of removing the cascading effect of the taxes. The cascading effect mean levy of tax on tax. The GST is levied on the net value added portion and not on the entire transaction value as the taxpayer would enjoy input tax credit. Barring few indirect taxes, all the major indirect taxes levied by the Central and State Governments are subsumed into the GST". Further the legislative intent can be gathered from Section 16 of the CGST Act which allows credit on all goods and service used or to be used in the course of furtherance of business, subject to certain exceptions as contained in Section 17(5) of the CGST Act. It is clearly coming out from the CGST Act read with the rules that wherever the legislative seeks to restrict/disallow the ITC, it has been specifically provided for. To buttress this, the appellant in their additional submissions dated 08.04.2025 filed at the time of personal hearing before the AAR, had relied upon the judgment o....
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....e legislature is well aware of the import IGST and has specifically provided for its coverage under CGST Act. * Section 16(2) sets out certain conditions for availing ITC. Clause (a) sets out that ITC would be available if the registered person is in possession of (i) an invoice or debit note issued by the supplier or (ii) such other duty paying documents as may be prescribed. Thus, there are two sets of categories provided as tax paying documents. This shows that the legislature has considered and specified the documents in the CGST Act read with the CGST Rules. * The second proviso to Section 16(2) provides for a condition that where a recipient fails to pay to the supplier, other than supplies covered under RCM within 180 days from the date of issue of invoice by the supplier, then he shall pay back the ITC availed by him. This clearly indicates that while the legislature is aware of the two categories it provided for in Section 16(1), the condition in 2nd proviso is only carved out for the invoice. * The distinction between the invoice / debit note and other duty paying documents continues under Section 16(4) wherein the time limitation is applicable only to the invoice a....
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....ocument under Rule 36(1)(c) of CGST Rules Situation of Bill of Entry already covered under CGST Rules Adoption of CGST Rules provision for IGST Rules would be superfluous Further, to the extent the CGST Act and CGST Rules have provided provisions for the ITC on bill of entries, such provisions are not incompatible with the IGST Act or IGST Rules and therefore there is no requirement to apply Section 20 of the IGST Act and Rule 2 of the IGST Rules to make them compatible. Otherwise, the forced application of Section 20 and Rule 2 would entirely displace the provisions of CGST Act and CGST Rules respectively, and therefore the observations of AAR at para 6.14 and 6.15 are erroneous. The appellant further contends that the AAR is selectively using the mutatis mutandis construction, and in that case, the said principle should have been applied in reference to Question No. 1 also. 4.3.4 The appellant submits that at para 6.16, the AAR upon relying on the judgment in Brakes India Ltd., Vs CCE [1997 (96) E.L.T 434 (Tri.-LB)], had held that any 'cause of action' which is legally enforceable is bound to be protected by a time limit even if it is not specified under the legal provisions....
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....slative intendment or otherwise. Therefore, the observations at para 6.17 based on any equitable consideration (even if assumed) are out of place and erroneous. 4.3.6 The appellant states that in the original application for advance ruling, they had given detailed submissions as to why the bill of entry is neither a tax invoice nor a debit note, and therefore not covered under Section 16(4) of the CGST Act. Since the AAR has not disputed the submissions to that extent, the appellant understands that AAR has accepted the submissions in this regard. Further the appellant's reliance on Order No.RAJ-EXCUS-000-APP-032-TO-033-2021-GST-JC passed by the Commissioner Appeals, GST & Central Excise, Rajkot in the case of M/s. Reliance Indutries Ltd., wherein it was held that the limitation under Section 16(4) is not applicable to a bill of entry, has been ignored by the AAR without providing any reasons for not considering the same. 4.3.7 Further, while comparing the provisions relating to limitation under Section 16(4) of the CGST Act, 2917, vis-à-vis the provisions of Rule 4(1) & 4(7) of the CENVAT Credit Rules, 2004, it could be seen that under the erstwhile CENVAT Credit Rules, t....
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.... roots and its object, because while tax invoice and debit note contains material particulars relating to transaction of supply of goods, TR-6 contains particulars relating to payment of tax/duties. Therefore, while TR-6 enables availing of ITC in view of the applicant's interpretation as above, but it is not a tax invoice or debit note. Thus, while 'TR-6 challan' read with SVB Order and Customs Authorities' letters are documents basis which ITC can be availed in terms of Section 16(2)(a) of the CGST Act read with Rule 36(1)(d) of the CGST Rules, the time limit referred to in Section 16(4) is not applicable to such documents. One of the salutary principles of interpretation is that when two words of different meanings are used in the statute in two consecutive provisions, it should be understood as they are used in different sense. In this regard, the following case laws were cited, viz., i. Member, Board of Revenue Vs Arthur Benthall [AIR 1956 (SC) 35; 1955 (2) SCC 84] - When two words are used in the statute in two consecutive provisions, it should be understood as they are used in different sense. ii. C. Cus Vs Dilip Kumar & Company [2018 (361) E.L.T. 577 (S.C)] - If the wor....
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....e CGST/TNGST Act read with Rule 36 of the CGST/TNGST Rules, 2017. Further, AR contended that there is no time limit prescribed for eligibility of ITC of the import IGST paid through TR-6 challan and re-assessed Bill of Entry under Section 16(4) of the CGST/TNGST Act, 2017. In support of his claim, AR submitted various case laws pronounced in various foras, in addition to referring to provisions of GST, Customs and erstwhile CENVAT Credit Rules on the eligibility of availing ITC and applicability of time limit to claim ITC. 5.4 Finally, referring to para 6.14 of the AAR order, AR Shri. Manish Sachdeva stated that 'mutatis mutandis' need to be applied for Section 16(1) of the CGST/TNGST also for availment of ITC. Under the additional submissions furnished by the appellant, it was seen that they have furnished a synopsis of the contentions put forth by them, highlighting the relevant paras/extracts and enclosing copies of the various case laws referred by them and the relevant legal provisions and circulars. 5.5 Further, through their mail dated 17.09.2025, the appellant requested that in place of para 3 of the PH note, the following para needs to be replaced. "The Authorised repr....
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....o taken on record for consideration. DISCUSSION AND ANALYSIS 6.1 We have carefully considered all the material available on record, the applicable statutory provisions, the 'Grounds of Appeal' furnished by the appellant, the submissions made during the personal hearing held on 28.08.2025, the additional submissions made and the amendment to the 'Record of Personal Hearing', as proposed by the appellant through their mail dated 17.09.2025. 6.2 Under the brief facts of the case, we find that apart from manufacturing and trading of medical equipment/devices, the appellant also carry out importing and trading the same. The appellant imports the goods from its group companies located outside India, on payment of appropriate customs duties (including BCD, SWS and Import IGST), on filing a Bill of Entry (BOE) for home consumption. Since import IGST is a creditable tax, the Appellant avails ITC of the same, and the said goods are subsequently sold in India on payment of outward CGST/SGST. The appellant has a limited risk distributorship agreement ("LRD agreement"), and as per the same, the goods are supplied by the overseas companies to the appellant at a price which would ensure that t....
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....actual background, we set out to examine the issues under appeal. Accordingly, in respect of query No. 1, viz., "Whether the Applicant can avail the ITC of the import IGST paid through TR-6 Challan in terms of Section 16(2) of the CGST Act read with rule 36 of CGST Rules?" is taken up for analysis." we find that the AAR under the impugned ruling dated 09.05.2025, has ruled as follows :- "Neither a TR-6 challan as such, nor a TR-6 challan read with the SVB order and letters issued by the tax authorities, as claimed by the applicant in the instant case can be considered as an eligible document for the purpose of availment of ITC." 6.6 We note that the provisions of Section 16(2) of the CGST Act, 2017, and Rule 36 of the CGST Rules, 2017, are relevant in this regard. While Section 16(2) of the CGST Act, 2017, reads as below :- "(2) Notwithstanding anything contained in this section, no registered person shall be entitled to the credit of any input tax in respect of any supply of goods or services or both to him unless,- (a) he is in possession of a tax invoice or debit note issued by a supplier registered under this Act, or such other tax paying documents as may be prescribe....
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....n the state of Tamil Nadu, they have imported goods through 3 different ports, viz., (i) Chennai Sea (ii) Chennai Air-Cargo, and (iii) Chennai FTWZ. While the Chennai Sea Customs authorities reportedly allowed re-assessment of bills of entry which meant that the differential duties would be payable through the re-assessed bills of entry, the Air Cargo and FTWZ (Free Trade Warehousing Zones) authorities on the other hand, directed the applicant to deposit the same through TR-6 challans. Under these circumstances, we are of the opinion that irrespective of the fact whether the differential duties of customs and Integrated taxes on import gets paid under a re-assessed bill of entry, or, by way of TR-6 challans, it amounts to 'assessment' as defined under Section 2(2) of the Customs Act, 1962, which reads as below:- (2) "assessment" means determination of the dutiability of any goods and the amount of duty, tax, cess or any other sum so payable, if any, under this Act or under the Customs Tariff Act, 1975 (51 of 1975) (hereinafter referred to as the Customs Tariff Act) or under any other law for the time being in force, with reference to- (a)-------------- -------------- (f) --....
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....t of ITC of IGST paid based on a TR-6 challan alone, but that the same should be seen and treated as 'TR-6 challan along with the SVB order and letter issued by the tax authorities to pay duty under Section 28(1)(b) of Customs Act', pursuant to price revision and re-assessment. Here again, we would like to reiterate that the documents referred above indeed convey the fact that assessment in relation to IGST on imports has taken place, but they are neither similar to a Bill of Entry', nor do they fall under the specific category of 'prescribed' documents under the Customs Act, 1962, or the rules made thereunder. Accordingly, the contention of the appellant about a TR-6 challan to be treated as a document similar to a 'Bill of Entry' or a 'TR-6 challan along with the SVB order and letter issued by the tax authorities to pay duty under Section 28(1)(b) of Customs Act', to be treated as a document similar to a 'Bill of Entry', lacks legal backing and is not sustainable. 6.10 Under these circumstances, the contents of Circular No. 16/2023-Customs (F.No.605/11/2023-DBK/569Z) dated 07.06.2023, (Implementation of Hon'ble Supreme Court direction in Judgment dated 28.04.2023 in matter of Ci....
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....d person. A TR-6 challan is not a prescribed document for the purpose. (c) The nature of facility in Circular No. 11/2015-Cus. (for suo moto payment of customs duty in case of bona fide default in export obligation) is not adequate to ensure a convenient transfer of relevant details between Customs and GSTN so that ITC may be taken by the importer. (d) The section 143AA of the Customs Act, 1962 provides that the Board may, for the purposes of facilitation of trade, take such measures for a class of importers-exporters or categories of goods in order to, inter alia, maintain transparency in the import documentation." However, in para 5.2 of the Circular, the procedure to be adopted in the given circumstances, has been provided as follows :- 5.2 Keeping above aspects in view, noting that the order of the Hon'ble Court shall have bearing on importers other than the respondents, and for purpose of carrying forward the Hon'ble Court's directions, the following procedure can be adopted at the port of import (POI) ;- (a) for the relevant imports that could not meet the said pre-import condition and are hence required to pay IGST and Compensation Cess to that extent, the importer ....
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....e GSTN portal, so as to enable the same to be available for the claim of ITC, was not a pre-requisite in the pre-GST era. In this regard, we find that the Hon'ble Supreme Court in para 74 (as referred in para 6.10 above) of its Order dated 28.04.2023 in the case of M/s. Cosmos Films Ltd., acknowledges the fact that GST is one of the significant tax reforms, and it also acknowledges the fact that the process of transformation entails challenges and inconveniences, but that the same cannot be considered as unreasonable or arbitrary. We are therefore, of the opinion that the case laws relied upon by the appellant, especially relating to the pre-GST period, do not have any relevance to the instant case. 6.14 We note that the appellant has also contended that wherever the legislative seeks to restrict/disallow the ITC, it has been specifically provided for, and to buttress this, the appellant in their additional submissions dated 08.04.2025 filed at the time of personal hearing before the AAR, had relied upon the judgment of the Hon'ble Bombay High Court in the case of L&T IHI Consortium Vs UOI [TS-740-HC (BOM)-2024-GST], wherein it was held that even a receipt voucher though not speci....
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....aving already held that TR-6 challan as such, or a TR-6 challan read with the SVB order and letters issued by the tax authorities, cannot be considered as an eligible document for the purpose of availment of ITC, as discussed in detail above. 6.17 Regarding the third query, viz., "Whether the eligibility to avail ITC of the import IGST paid under the re-assessed bill of entry is subject to the time limit prescribed under Section 16(4) of the CGST Act?", we need to start with the relevant provision, viz., Section 16(4) of the CGST Act, 2017, which read as below :- "(4) A registered person shall not be entitled to take input tax credit in respect of any invoice or debit note for supply of goods or services or both after the thirtieth day of November following the end of financial year to which such invoice or debit note pertains or furnishing of the relevant annual return, whichever is earlier." We take note of the fact that the aforesaid provision that prescribes time limit for availment of ITC, indeed refers to an invoice or a debit note only, without referring to any other document. However, it may be seen that apart from a tax invoice and a debit note, the provisions of Secti....
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....lication of Central Goods and Services Tax Rules.- The Central Goods and Services Tax Rules, 2017, for carrying out the provisions specified in section 20 of the Integrated Goods and Services Tax Act, 2017 shall, so far as may be, apply in relation to integrated taxes they apply in relation to central tax." Once the provisions of CGST Act and Rules are made applicable to IGST, mutatis mutandis, for the purposes of and in relation to 'scope of supply', input tax credit, assessment, demands and recovery, etc., it becomes clear that the necessary changes and differences have to be considered while applying the CGST provisions to that of IGST. Under these circumstances, the term 'mutatis mutandis' assumes significance and it generally means that the respective differences have been considered, and as per Wikipedia, it means "with things changed that should be changed", "once the necessary changes have been made". 6.19 We find that the provisions of 16(4) of the CGST Act, 2017 that prescribes the time frame for availment of ITC refers just to an invoice or a debit note, in view of the fact that the levy enabled under Section 9 of the Act, ibid, is only in respect of 'intra-state' supp....
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....erm is unwarranted in the context of the instant case, as the IGST charged on import of goods stands already covered under the definition of 'input tax' under the CGST Act, 2017. In this regard, we find that the appellant has highlighted how the term "mutatis mutandis" gets defined, and specifically as per Black's Law Dictionary it means "with the necessary changes in points of detail, meaning that matters or things are generally the same, but to be altered when necessary, as to names, offices and the like." They further stated that the Hon'ble Supreme Court in the case of Ashok Service Centre Vs State of Orissa (1983 AIR 394) has observed that the phrase is of frequent practical occurrence, meaning that matters or things are generally the same, but to be altered when necessary, as to names, offices and the like. The extension of the earlier Act mutatis mutandis to a later Act brings in the idea of adaptation, but so far only as it is necessary for the purpose, making a change without altering the essential nature of the thing changed, subject of course to express provisions made in the later Act. In other words, 'mutatis mutandis' should not lead to usurping what the legislature i....
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....s collection of 'Central Goods and Services Tax (CGST)' through Section 9 of the Act, ibid, for 'Levy and Collection' of CGST, on the other hand, 'Integrated Goods and Services Tax (IGST)', is levied and collected towards the inter-state supplies under Section 5 of the IGST Act, 2017. Here it becomes worthwhile to again reproduce the provisions of Section 16(4) of the CGST Act, 2017, i.e., "(4) A registered person shall not be entitled to take input tax credit in respect of any invoice or debit note for supply of goods or services or both after the thirtieth day of November following the end of financial year to which such invoice or debit note pertains or furnishing of the relevant annual return, whichever is earlier." Therefore the term 'Supply' referred to under the aforesaid provision, relates only to intra-state supplies, in the manner it is prescribed under the CGST Act, 2017, which in turn is meant for levy and collection of CGST on intra-state supplies. It is to be noted here that while an intra-state supply involves issue of an invoice or a debit note, an inter-state supply entails issue of an invoice or a debit note, and a 'Bill of Entry' as well. We are therefore of t....
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....in as much as Rule 57E post amendment provided full MODVAT credit as compared to Rs.800/MT. In that case, the Tribunal had held that the time limit for claiming the additional MODVAT would be similar to the time limit applicable for availing initial credit, i.e., six months. They stated that however in the instant case, Section 16(4) is not even applicable to bill of entries and therefore, the question of importing limitation for bill of entry does not arise. In this regard, we observe that the AAR in para 6.16 of its original ruling dated 09.05.2025, has started the discussion in relation to this aspect with the phrase "Notwithstanding the same", which goes to convey the fact that this argument is exclusive of the main contention, and is in addition to, or ancillary to the main contention. However, on perusal of the Brakes India case, we note that it talks about the applicability of the normal time limit as it existed at the relevant period of time, i.e., six months, even in situations where it is not prescribed. Under these circumstances, we would like to add here that eventhough the facts of the case involving M/s. Brakes India is distinguishable from the instant case, the analo....