The petitioner consortium challenged levy of GST on advances received for execution of a large infrastructure project and the consequential denial of input tax credit on such advances. The factual background showed that the advances were in the nature of interest-free loans repayable through deductions from running bills, yet GST was levied at the time of receipt.

The Court examined the statutory scheme relating to time of supply, definition of supply, and eligibility of ITC. It held that levy of GST on advances while simultaneously denying ITC creates serious anomalies within the GST framework. The Court granted relief to the petitioner by recognising the inconsistency in taxing advances without permitting corresponding credit and directed appropriate relief in accordance with law.