GST ITC Denied due to Delayed Claim: Madras HC directs to Re-do Assessment following recent Amendment [Read Order]

The Madras High Court set aside a Goods and Services Tax ( GST ) order, which disallowed Input Tax Credit ( ITC ) for the assessment year 2019-20 on the ground that the claims were filed beyond the prescribed time limit under Section 16(4) of the GST Acts.

The writ petition challenged the order, citing a recent amendment introduced through Section 118 of the Finance (No. 2) Act, 2024, which inserted new subsections (5) and (6) to Section 16 of the GST Acts.

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The amendment, effective retrospectively from July 1, 2017, allows ITC claims for specific financial years, including 2019-20, in returns filed up to November 30, 2021. It also provides relief for cases where registration cancellations were subsequently revoked, permitting ITC claims under specified conditions.

The petitioner argued that the adjudicating authority’s reasons for disallowing ITC no longer hold valid in light of the amendment. The Court noted that similar cases had been remanded in the past based on the proposed amendments and directed the respondent to re-do the assessment, considering the updated legal provisions.

Justice Mohammed Shaffiq, considering the submissions, the Court instructed the petitioner to submit objections within three weeks, along with relevant details, and directed the respondent to pass a revised order after providing a reasonable opportunity for a personal hearing. While the ITC issue was remanded, other aspects of the impugned order remained unaffected.

To Read the full text of the Order CLICK HERE

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