Background of the Case
The petitioner, a registered assessee under the CGST/SGST Acts, had claimed Input Tax Credit for the financial year 2020–21. However, the assessing authority issued an order disallowing the ITC amounting to Rs 2,16,812, along with applicable interest and penalties. The reason for disallowance was that the suppliers involved in the transactions could not be traced, casting doubt on the genuineness of the claim.
The petitioner challenged this order and relied on a prior judgment of the Kerala High Court in M. Trade Links v. Union of India [2024 TAXONATION 1190 (KERALA)], where similarly situated taxpayers were allowed to submit supporting documents for their transactions before a final decision was made.
Court's Observations
Upon review, the Court noted that the facts of the current case were materially similar to the M. Trade Links case, and hence, there was no reason to deny the petitioner a similar opportunity. Accordingly, the Court partially set aside the earlier assessment order—specifically to the extent it denied ITC under Section 16(2)(c) and Section 16(4) of the CGST/SGST Acts.
What the Court Ordered
The Court directed that:
The petitioner shall submit relevant documents—as required under the circular referred to in Para 101 (Circular No. 183/15/2022- GST dated 27.12.2022 and Circular No. 193/05/2023- GST dated 17.07.2023) of the M. Trade Links judgment—within one month of receiving the copy of the judgment.
If the documents are submitted on time, the assessing officer must re-assess the claim accordingly.
If the petitioner fails to submit the documents, the original order will remain valid and enforceable.
GST Case Law Hercules Automobiles International PVT. Versus Union of India
Citation-2025 TAXONATION 1668 (KERALA)
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