Wrongful Claim of ITC in IGST Instead of CGST: Calcutta HC Stays GST Demand considering Revenue Neutral [Read Order]

The Calcutta High Court stayed the Goods and Service Tax demand against the wrongful claim of Input Tax Credit (ITC) in Interstate Goods and Service Tax (IGST) instead of Central Goods and Service Tax Act (CGST).The bench stayed the demand considering the revenue neutrality.

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Wilhelmsen Port Services India Private Limited and Anr, the writ petitioners challenged an interim direction dated 24th February, 2025 in WPA 406 of 2025. In the said order the Single Bench exercised discretion while granting an order of stay by directing the appellants to pay 10% of the balance amount of tax in dispute.

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Under normal circumstances in an intra court appeal, the court will not interfere with the discretion exercised by the Single Bench. However, in the instant case the peculiar facts and circumstances persuade us to grant an order of stay of the impugned orders in the writ petition without any condition.This is because the case of the appellant/writ petitioners is that they committed a mistake while claiming ITC in IGST to the tune of Rs.19,12,857/- in the place of actual claim of ITC in CGST of Rs.9,56,429.12/- in WBGST of Rs.9,56,429.12/- and, as a result of the said ITC in IGST of Rs.19,12,857/- was reflected in the electronic credit ledger of IGST.

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A division bench of  Chief Justice T. S. Sivagnanam and Justice Chaitali Chatterjee (Das) found that there is no revenue loss to the Government and it is revenue neutral. Considering the situation, the court viewed that the orders impugned in the writ petition shall remain stayed till the disposal of the writ petition and the petitioners are exempt from making the payment of 10% of the tax in dispute as ordered by the  writ court.

To Read the full text of the Order CLICK HERE

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WILHELMSEN PORT SERVICES INDIA PRIVATE LIMITED AND ANR. vs STATE OF WEST BENGAL AND ORS. , 2025 TAXSCAN (HC) 499 , IA NO: CAN/1/2025 , 25 March 2025 , Mr. Himangshu Kumar Ray , Md. T.M. Siddiqui