Case Details: Rubicon Associates vs. State Tax Officer (2026) 39 Centax 89 (Mad.)
Judiciary and Counsel Details
- C. Saravanan, J.
- Ms G. Vardini Karthik, for the Petitioner.
- Ms Amirtha Poonkodi Dinakaran, Govt. Adv., for the Respondent.
Facts of the Case
The petitioner was issued a show cause notice in Form GST DRC-01 under Section 16, read with Section 73 of the CGST Act and the Tamil Nadu GST Act, proposing a demand arising from the belated availment of input tax credit (ITC) and a mismatch between GSTR-2A and GSTR-3B. The petitioner did not file a reply, and an adverse demand order was passed. Thereafter, rectification was sought, contending that the issue of delayed availment of ITC stood settled in favour of the assessee pursuant to the retrospective insertion of Sections 16(5) and 16(6) by the Finance (No. 2) Act, 2024, dated 16-08-2024, with effect from 01-07-2017. It was submitted that the demand arising from belated ITC could not survive in view of the statutory amendment. The matter was accordingly placed before the High Court.
High Court Held
The High Court held that the issue relating to belated availment of ITC under Section 16(4) stood concluded in favour of the assessee by virtue of the retrospective insertion of Sections 16(5) and 16(6), and therefore, the demand to that extent could not be sustained. It was observed that the statutory intervention had altered the legal position with retrospective effect and was binding on the authorities. Insofar as the mismatch between GSTR-2A and GSTR-3B was concerned, the Court held that the matter required fresh consideration on merits. Accordingly, the issue relating to the mismatch was remitted to the original authority for adjudication after affording the assessee an opportunity of hearing, with liberty to file a reply along with supporting documents, and the authority was directed to pass a final order in accordance with law.
