South Indian Oil Corporation vs. The Assistant Commissioner,
Facts:
The petitioner, engaged in procurement and sale of edible oils, purchased oils in bulk and repacked them for sale at 5% GST.
Due to higher GST rates on certain inputs, unutilised Input Tax Credit (ITC) accumulated, and refund was claimed under the inverted duty structure.
Refund applications were rejected by authorities and appellate authority on the ground that input and output goods were the same.
Aggrieved, the petitioner filed the present writ petition challenging rejection of refund.
Court Decision:
The High Court allowed the petition and set aside the impugned orders rejecting refund.
- Held that Section 54(3)(ii) of the CGST Act does not prohibit refund merely because input and output goods are the same.
- Refund is admissible if ITC accumulation is due to higher tax on inputs compared to output supply.
- Circular No. 135/05/2020 restricting refund where input and output are same was held inapplicable and later restriction removed by Circular No. 173/05/2022.
- The 2022 Circular being beneficial and clarificatory was held retrospectively applicable.
- “Net ITC” includes all inputs irrespective of tax rates as per Rule 89(5).
Cases Referred by Court:
- Indian Oil Corporation Ltd. vs. Commissioner of CGST (Delhi High Court, 2023)
- Suchitra Components Ltd. vs. CCE, Guntur (2006)
- K.P. Varghese vs. Income Tax Officer (1981)
- Union of India vs. VKC Footsteps India Pvt. Ltd. (Supreme Court)
- Baker Hughes Asia Pacific Ltd. vs. Union of India
- Shivaco Associates vs. Joint Commissioner of State Tax
- BMG Informatics Pvt. Ltd. vs. Union of India
- Malabar Fuel Corporation vs. ACCT & CE
- MO Industries vs. Union of India
- Eveready Spinning Mills Pvt. Ltd. vs. ACCT
Other Case Law
Ravinder Mehta v. State of Uttar Pradesh
Regular bail in a trap case under Section 7 of the Prevention of Corruption Act, 1988 — whether an accused can be kept in custody where the charge-sheet stands filed but sanction for prosecution has still not been granted, leaving the trial court unable
B A C K G R O U N DThe appellant figured as an accused in FIR registered in Dece...
Read MoreCargotec India Pvt. Ltd. vs. Commissioner of GST & Central Excise
Whether refund of unutilized CENVAT Credit under Rule 5 of the CENVAT Credit Rules, 2004 on export of IT Software Services can be denied on the grounds of (i) services rendered from unregistered premises, and (ii) absence of nexus between input services a
BACKGROUND The appellant, a 100% Export Oriented Unit operating under the S...
Read MoreChristie's India Private Limited v. Union of India & Ors.
Challenge to the constitutional validity of Section 16(2)(c) of the CGST Act, 2017 and the corresponding provision of the Maharashtra GST Act, 2017, on the grounds of violation of Articles 14, 19(1)(g) and 300A of the Constitution.
BackgroundThe petitioner challenged the constitutional validity of Section 16(2)...
Read More