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SGST High Court Cases

GST – Challenge to Constitutional validity of Section 16(2)(c) of the CGST Act, 2017 and Rule 36(4) of the CGST Rules, 2017 - Denial of input tax credit on account of the difference in GSTR 2A and GSTR 3B returns – Entitlement and conditions for claiming input tax credit by purchasing dealer under Section 16 of the CGST Act, 2017 – HELD - It is settled that input tax credit is in the nature of a concession and not a right extended to the dealer under the statutory scheme. The said benefit can accrue to the assessee only as per the scheme of the statute - It is equally settled that the rule-making authority can provide restrictions in extending the concession - existence of a tax invoice or debit note issued by the supplying dealer, proof of receipt of goods or services or both, and the tax charged in respect of such supply having been actually paid to the Government, either in cash or through utilization of input tax credit admissible in respect of the said supply are the conditions to be satisfied for enabling the benefit of input tax credit - One of the preconditions for the purchasing dealer to claim input tax credit under section 16 of the CGST Act is that purchasing dealer must produce the tax invoice issued by the supplying dealer – in the present case, the appellants failed to produce the tax invoices despite sufficient opportunities extended - As per section 155 of the CGST Act, the burden is on the dealer who claims the benefit of input tax credit to prove that he is eligible for such benefit. The appellants did not discharge the said burden as failed to produce any evidence to prove that they are entitled to the benefit of input tax credit - It is now well settled that any tax legislation may not be easily interfered with. The court must show judicial restraint to interfere with tax legislation unless it is shown and proved that such taxing statute is manifestly unjust or glaringly unconstitutional. Taxing statutes cannot be placed, tested or viewed on the same principles as laws affecting civil rights - The vires of section 16(2)(c) of the CGST Act or Rule 36(4) of the CGST Rules is not under challenge on the ground of legislative incompetence. The challenge of the constitutional validity of the provisions on the grounds of violation of Article 14 of the Constitution is vague. Nothing in the impugned provisions indicates that they discriminate between the purchasing and selling dealers - The prescription of the conditions cannot be considered discriminatory to contravene Article 14 - the challenge to the constitutional validity of the impugned provisions fails – the appeal is dismissed
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