TaxTMI 
TaxTMI 
2026 (6) TMI 616
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.... 1.1 At the outset, we would like to make it clear that the provisions of the Central Goods and Services Tax Act, 2017 (the CGST Act, for short) and the West Bengal Goods and Services Tax Act, 2017 (the WBGST Act, for short) have the same provisions in like matter except for certain provisions. Therefore, unless a mention is specifically made to such dissimilar provisions, a reference to the CGST Act would also mean reference to the corresponding similar provisions in the WBGST Act. Further to the earlier, henceforth for the purposes of these proceedings, the expression "GST Act" would mean the CGST Act and the WBGST Act both. 1.2 The applicant, M/s Eastern Coalfields Limited (ECL), has filed the present application for Advance Ruling in view of the retrospective insertion of sub-section (5) to Section 16 of the Central Goods and Services Tax Act, 2017 by the Finance (No. 2) Act, 2024 with effect from 01.07.2017. The applicant had earlier availed Input Tax Credit on invoices raised by M/s Gayatri Projects Limited pertaining to the period January 2020, February 2020 and March 2020 in connection with services rendered under a longwall mining project agreement executed with M/s Chi....
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....cation for Advance Ruling was filed before this Authority. The West Bengal Authority for Advance Ruling vide Order No. 07/WBAAR/2021-22 dated 09.08.2021 held that the Applicant was not entitled to avail the said Input Tax Credit. Pursuant to the said ruling, the Applicant reversed the Input Tax Credit already availed in respect of the invoices pertaining to the aforesaid tax periods. 2.3 The Applicant submits that thereafter the Finance (No. 2) Act, 2024 inserted sub-section (5) to Section 16 of the CGST Act, 2017 with retrospective effect from 01.07.2017. The said amendment provides a substantive benefit by allowing availment of Input Tax Credit in specified circumstances where the same was previously denied on account of procedural or technical restrictions. According to the Applicant, the retrospective nature of the amendment clearly demonstrates the legislative intent to cure hardships faced by taxpayers and to regularize availment of Input Tax Credit for past tax periods. 2.4 The Applicant submits that in view of the retrospective amendment to Section 16 of the CGST/WBGST Act, 2017, the legal position prevailing at the time of passing of the earlier Advance Ruling order ....
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....d into a contract with M/s. China Coal Overseas Development Co. Ltd. (here-in-after referred to as "CODCO") for Longwall Mining project vide agreement dated 19.12.2015. In terms of the aforesaid contract, ECL and CODCO executed the following three agreements in respect of the following works set out in the Tender: 1. Contract for Site Investigation and Study bearing Contract No: ECL CODCO/HQ/07/2012-2013. 2. Contract for Supply of Equipment and Initial Spares bearing Contract No: ECL CODCO/HQ/07/2012-2013; and 3. Contract for Provision of Services bearing Contract No: ECL CODCO/HQ/07/2012-2013 ("Service Contract"). The applicant states in his submission that CODCO has transferred all the rights and obligations under the service contract in favour of M/s Gayatri Projects Limited (hereinafter referred to as "GPL") by taking approval from ECL vide letter CODCO/ECL-20150828 dated 28.08.2015. ECL, vide its letter dated 14.15.2015, accorded its approval to CODCO for the assignment and transfer of all the rights and obligations of CODCO under the Service Contract in favour of Petitioner and it was agreed between the Parties that even after the assignment by C....
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.... the parties afresh, permit GPL to submit documents as well as written submissions and thereafter to pass fresh order on merits in accordance with law. That in compliance of the order dated 05.01.2023 passed by the Hon'ble Calcutta High Court, the Ld. Bench vide its Order No. 01/WBAAR/2023-24 dated 06.04.2023 allowed M/s. ECL and Gayatri Projects Limited, both, an opportunity for personal hearing and to furnish Written Submissions, if any. That after hearing both sides, the Ld. Bench reiterated its observations and held that ECL is not entitled to Input Tax Credit and is required to reverse the credit availed by it on the invoices raised by GPL pertaining to the period January-2020, February-2020 & March-2020 unless the condition as prescribed in the proviso to sub-rule (4) of rule 36 of the GST rule is fulfilled. 4.3 The applicant submits that in the event of insertion of sub-section (5) under Section 16 through Section 118 of the Finance (No. 2) Act, 2024 dated 16-08-2024 with retrospective effect from 01-07-2017 and notified by Notification No. 17/2024-Central Tax dated 27-09-2024 the circumstance has changed now. Under this changed circumstance the applicant has placed th....
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....titled 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. Provided that the registered person shall be entitled to take input tax credit after the due date of furnishing of the return under section 39 for the month of September, 2018 till the due date of furnishing of the return under the said section for the month of March, 2019 in respect of any invoice or invoice relating to such debit note for supply of goods or services or both made during the financial year 2017-18, the details of which have been uploaded by the supplier under sub-section (1) of section 37 till the due date for furnishing the details under sub-section (1) of said section for the month of March, 2019. 4.6 In the case we have in our hand, the followings are the facts and circumstances as per application and written submissions at the time of hearing: A) The applicant is the recipient of supply and Gayatri Projects Limited (GPL) is the supplier of service. ....
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....ity and conditions for taking input tax credit.-(1): Every registered person shall, subject to such conditions and restrictions as may be prescribed and in the manner specified in section 49, be entitled to take credit of input tax charged on any supply of goods or services or both to him which are used or intended to be used in the course or furtherance of his business and the said amount shall be credited to the electronic credit ledger of such person. (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 prescribed; (b) he has received the goods or services or both. [Explanation.- For the purposes of this clause, it shall be deemed that the registered person has received the goods or, as the case may be, services-- (i) where the goods are delivered by the supplier to a recipient or any other person on the direction of such registered person, whether....
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....due date of furnishing of the return under the said section for the month of March, 2019 in respect of any invoice or invoice relating to such debit note for supply of goods or services or both made during the financial year 2017-18, the details of which have been uploaded by the supplier under sub-section (1) of section 37 till the due date for furnishing the details under sub-section (1) of said section for the month of March, 2019.] 4.4 It therefore follows that while sub-section (1) of section 16 of the GST Act provides for entitlement of input tax credit to every registered person subject to such conditions and restrictions as may be prescribed and in the manner specified in section 49, sub-section (2) of section 16 which is a non-obstante provision specifically refers to the conditions where a registered person shall not be entitled to take the credit of input tax in respect of any supply of goods or services or both to him. Further, sub-section (3) and (4) of the said section also put restrictions towards entitlement of input tax credit under certain situations. 4.5 In the case in our hand, we find that the applicant has availed credit of input tax upon rec....
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....reads as under: "(4) Input tax credit to be availed by a registered person in respect of invoices or debit notes, the details of which have not been uploaded by the suppliers under sub-section (1) of section 37, shall not exceed 10 per cent. of the eligible credit available in respect of invoices or debit notes the details of which have been uploaded by the suppliers under sub-section (1) of section 37." 4.10 In this context, reference may be drawn to para 3 of the Circular No. 123/42/2019-GST dated 11.11.2019 issued by Central Board of Indirect Taxes and Customs, GST Policy Wing [Corresponding Trade Circular No. 43/2019 dated 18.11.2019 issued by the Commissioner, State Tax, West Bengal] wherein it has been clarified that 'The conditions and eligibility for the ITC that may be availed by the recipient shall continue to be governed as per the provisions of Chapter V of the CGST Act and the rules made there under. This being a new provision, the restriction is not imposed through the common portal and it is the responsibility of the taxpayer that credit is availed in terms of the said rule and therefore, the availment of restricted credit in terms of sub-rule (4) o....
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....ut at the same time, the applicant cannot deny that the provisions of sub-rule (4) of rule 36 was already in force during the period when the applicant has availed of input tax credit issues of which we are dealing with in this case. 4.16 Further, we find that a proviso has been inserted to sub-rule (4) of rule 36 vide Notification No. 30/2020-Central Tax dated 03.04.2020 [Corresponding West Bengal Notification No. 462-F.T. dated 15.04.2020] which reads as follows: "Provided that the said condition shall apply cumulatively for the period February, March, April, May, June, July and August, 2020 and the return in FORM GSTR-3B for the tax period September, 2020 shall be furnished with the cumulative adjustment of input tax credit for the said months in accordance with the condition above." 4.17 Circular No. 142/12/2020-GST dated 09.10.2020 has been issued by Central Board of Indirect Taxes and Customs, GST Policy Wing [Corresponding West Bengal Trade Circular No. 09/2020 dated 13.10.2020] clarifying applicability of sub-rule (4) of rule 36 of the CGST Rules, 2017 in terms of the said proviso. Relevant portion of the circular is reproduced herein under: ....
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....isions of Section 16(4) supra have been overridden by virtue of insertion of sub-section (5) to Section 16 for specific financial years. This sub-section nullifies the application of sub-section (4) in respect of Financial Years starting from 2017-18 to 2020-21. In our understanding, for the above noted financial years eligibility and conditions of availing ITC should be understood keeping aside the provisions of Section 16(4) in case of returns for the said financial years filed up to 30.11.2021. However, in order to clarify any doubt, we reiterate that the other guiding sub-sections of Section 16 viz. sub-section (2) and (3) will be in force for availing ITC for the related financial years as well. Especially sub-section (2) is a non-obstante clause. For entitlement to the credit of any input tax the provisions contained in sub-section (2) are to be fulfilled. 4.9 Now the most relevant question comes whether insertion of Section 16(5) has created any new scenario for the applicant to enjoy the referred Input Tax Credit which has already been reversed. The applicant did comply with the provisions of Section 16(4) during the material point of time by furnishing returns in GST....