Satyam Steels And Alloys vs. The Union Of INDIA And 2 Ors.
Original PDF →Facts
The petitioner, Satyam Steels and Alloys, a partnership firm, challenged the vires of Section 16(4) of the GST Act, 2017, and an Order-in-Original dated February 15, 2022. This order, passed by the Assistant Commissioner, CGST & CX, Itanagar, rejected the petitioner's Input Tax Credit (ITC) refund claim for January 2020 to March 2020. The rejection was based on the petitioner allegedly availing ITC in contravention of Section 16(4) of the CGST Act, 2017, read with Section 20 of the IGST Act, 2017, and the Arunachal Pradesh GST Act, 2017. During the pendency of the writ petition, Section 16 of the CGST Act was amended with retrospective effect from July 1, 2017, by inserting Sub-Section (5).
Held
The Court held that in view of the amendment brought to Section 16 of the Central Goods and Services Tax Act, 2017, by inserting Sub-Section (5) with retrospective effect from July 1, 2017, the grievance raised by the petitioner has been redressed. Consequently, the impugned Order-in-Original dated February 15, 2022, passed by the Assistant Commissioner, CGST & CX, Itanagar, was set aside without adjudicating on its merits. The respondent authorities were directed to consider and pass an appropriate order taking into account the provisions of Sub-Section (5) of Section 16 of the Central Goods and Services Tax Act, 2017, as amended by the Finance Act, 2024, vide Gazette Notification dated August 16, 2024. The writ petition was disposed of in terms of these observations and directions.
Key Issues
1. Whether the impugned Order-in-Original dated February 15, 2022, passed by the Assistant Commissioner, CGST & CX, Itanagar, rejecting the petitioner's ITC refund claim for January 2020 to March 2020, is liable to be set aside in light of the retrospective amendment to Section 16 of the CGST Act, 2017. Petitioner's contention: The petitioner argued that the insertion of Sub-Section (5) into Section 16 of the CGST Act, 2017, with retrospective effect, has redressed their grievance. They contended that the impugned order should be set aside and the matter remanded for passing an appropriate order considering the newly inserted sub-section. Revenue's contention: The respondents (Union of India and others) agreed that the insertion of Sub-Section (5) in Section 16 of the CGST Act, 2017, has redressed the petitioner's grievance.
Sections Cited
Section 16(4), Section 16(5), Section 20
AI-generated summary — verify with the full judgment below
Cause title — parties, addresses and appearances
ORDER 16.09.2024 (Kardak Ete, J) Heard Dr. A. Saraf, learned Senior Advocate assisted by Ms. T. Y. Bhutia, learned counsel for the petitioner. Also heard Mr. M. Kato, learned DSGI appearing for the respondent No.1 and Mr. M. K. Boro, learned Standing Counsel, CGST & CX/respondent Nos. 2, 3 & 4. 2. By filing this writ petition, the petitioner has put to challenge the vires of Section 16(4) of the GST Act, 2017 and the Order-in-Original dated 15.02.2022, passed by the Assistant Commissioner, CGST & CX, Itanagar Division/respondent No. 3, whereby, ITC refund claimed by the petitioner for a period from January, 2020 to March, 2020, has been rejected on the ground that the petitioner availed the Input Tax Credit (ITC) wrongly in contravention to Section 16(4) of the CGST Act, 2017, read with Section 20 of the IGST Act, 2017, and the applicable Arunachal Pradesh GST Act, 2017. 3. During the pendency of the writ petition, vide Gazette Notification dated 16.08.2024, an amendment in Section 16 of the Central Goods and Services Tax, has been brought in with retrospective effect from 01.07.2017 by inserting Sub-Section (5) in Section 16 of the Central Goods and Services Tax Act, 2017. Page No.# 4/5
Section 16(5) of the Central Goods and Services Tax Act, 2017 reads as under:
“(5) Notwithstanding anything contained in sub-section (4), in respect of an invoice or debit note for supply of goods or services or both pertaining to the Financial Years 2017-18, 2019-20 and 2020-21, the registered person shall be entitled to take input tax credit in any return under Section 39 which is filed up to the thirtieth day of November, 2021.”
The learned counsels appearing for the respondents are in agreement that in view of the insertion of Sub-Section (5) in Section 16 of the Central Goods and Services Tax Act, 2017, the grievance raised by the petitioner has been redressed.
Dr. A. Saraf, learned Senior Advocate for the petitioner, submits that in view of the amendment brought in Section 16 of the Central Goods and Services Tax Act, 2017 by inserting Sub-Section (5), the impugned Order-in-Original dated 15.02.2022 passed by the respondent authorities may be set aside and matter be remanded back and direction may be issued to pass an appropriate order in view of insertion of Sub-Section (5) of Section 16 of Central Good and Services Tax Act, 2017. 7. In view of the submissions made by the learned counsels for the parties and also considering the amendment brought in Section 16 of the Central Goods
Page No.# 5/5 and Services Tax Act, 2017, by inserting Sub-Section (5), the impugned order in original dated 15.02.2022 is hereby set aside without adjudicating the said orders on merit.
The respondent authorities are directed to consider and pass an appropriate order taking into consideration of the provision of Sub-Section (5) of Section 16 of the Central Goods and Services Tax Act, 2017, vide Amendment (Finance Act, 2024) dated 16.08.2024. 9. This writ petition stands disposed of, in terms of the above observation and direction.
JUDGE JUDGE Comparing Assistant
Reproduced from the public record of the Gauhati High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.