M/S Sangita Enterprises vs. The State Of Bihar

Held

The Court held that sub-section (4) of Section 16 of the CGST/BGST Act is constitutionally valid and does not violate Article 19(1)(g) or Article 300-A of the Constitution of India. The Court found no merit in the petitioners' arguments that the provision imposes unreasonable restrictions or lacks rationale. Relying on Supreme Court decisions in ALD Automotive Private Limited and Jayam and Company, the Court reasoned that Input Tax Credit (ITC) is a concession extended by the statute, and its benefit can only be availed by strictly complying with the conditions laid down, including the time limits specified. The Court rejected the plea to read down the provision or declare it directory, emphasizing the clear language of Section 16. The Court found no inconsistency with any fundamental right guaranteed under the Constitution. No issue was expressly left undecided.

Facts

Multiple petitioners, including Gobinda Construction, Shtrudhan Kumar Amit Kumar, Shiva Escorts, Komal Medical Agency, M/s Ram Kishun Saw Mill Trading and Company, Shanti Motors, Mrityunjay Kumar (M/s J.M.C.M. Sales Patna), Neelam Automobiles, and Nidhi Trading Company, filed writ petitions before the Patna High Court. These petitions challenged actions or orders related to the Goods and Services Tax (GST) regime. The specific tax periods and amounts in dispute are not detailed in the provided excerpt. The procedural history indicates these were writ jurisdiction cases filed in 2021, and the judgment was delivered on September 8, 2023.

Key Issues

1. Whether sub-section (4) of Section 16 of the CGST/BGST Act, which imposes a cut-off date for claiming Input Tax Credit (ITC), is constitutionally valid and does not violate Article 19(1)(g) (freedom of trade and profession) or Article 300-A (right to property) of the Constitution of India. The petitioners argued that this provision imposes unreasonable and disproportionate restrictions, lacks rationale for the cut-off date, and should be read down as directory, not mandatory. They contended it violates Article 19(1)(g) and Article 302 of the Constitution, and is in teeth of Article 13. The revenue or State did not present arguments on this specific point in the excerpt, but the court's reasoning implies their stance was that the provision is valid. 2. Whether the requirement of sub-section (4) of Section 16 of the CGST/BGST Act should be declared directory and not mandatory. The petitioners argued for this interpretation, while the revenue's position is implied by the court's rejection of this plea.