Wrongful ITC Claim: Calcutta HC Exempts Wilhelmsen Port Services from Paying 10% Disputed Tax Observing Revenue Neutrality [Read Order]

The Calcutta High Court recently ruled in favor of Wilhelmsen Port Services India Private Limited, exempting the company from making a 10% payment of the disputed Input Tax Credit (ITC) amount, observing that the ITC claim in question was revenue-neutral and did not lead to any loss to the government exchequer.

The case arose from an ITC claim made by Wilhelmsen Port Services India, where the company mistakenly claimed ITC in IGST amounting to ₹19,12,857 instead of the correct claims under CGST and WBGST, each amounting to ₹9,56,429.12.

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This error led to the disputed ITC reflecting in the electronic credit ledger under IGST. The matter was contested before the writ court, where the Single-Judge Bench directed the petitioner to deposit 10% of the disputed tax amount as a pre-condition for granting a stay.

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Therefore, Wilhelmsen Port Services India, represented by counsels Himangshu Kumar Ray, Arup Dasgupta, Shiwani Shaw, Bhaskar Sengupta, Subhasis Podder, Animitra Roy, Piyas Chowdhury, and Amit Saha challenged the order of the Single-Judge Bench before the Division Bench.

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Meanwhile, Md. T.M. Siddiqui, N. Chatterjee, Tanoy Chakraborty, and Saptak Sanyal represented the Respondent State of West Bengal.

The Division Bench, comprising Chief Justice T.S. Sivagnanam and Justice Chaitali Chatterjee (Das) noted that while appellate courts typically do not interfere with the discretion exercised by a Single Judge, the peculiar facts of this case warranted an exception.

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The Calcutta High Court observed that the ITC claim in question was revenue-neutral as there was no monetary loss to the tax authorities. Consequently, the Court modified the interim order and stayed the demand without any conditional payment.

However, the Bench clarified that the present decision was passed purely in light of the unique facts and circumstances of the present case and thus should not be treated as a precedent for future matters.

To Read the full text of the Order CLICK HERE

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