2026-VIL-65-GSTAT-LCK
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  2. 2026-VIL-65-GSTAT-LCK

SGST Tribunal

GST - Classification of Input Tax Credit and allocation between tax heads - ITC available under IGST availed under the CGST and SGST heads - Show cause notice issued alleging excess availment of ITC due to differences in allocation between IGST, CGST and SGST heads - Whether the discrepancy in classification of ITC between different tax heads constitutes excess availment when the aggregate eligible ITC claimed is within the eligible entitlement and no revenue loss is caused - HELD - Department has not established that the Appellant availed ITC in excess of its aggregate eligible entitlement. The discrepancy is essentially attributable to reporting and classification of ITC under different tax heads and the eligibility of underlying credit has not been shown to be disputed on substantive grounds – The ITC available in the electronic credit ledger should be considered as a pool of funds designated for different types of taxes such as IGST, CGST and SGST and while determining interest under Rule 88B of the CGST Rules, the entire wallet has to be taken into consideration and not just individual compartments - If the total balance combining IGST, CGST and SGST does not fall below the amount of wrongly availed credit, there is no interest liability - Once the principal demand of alleged excess ITC is found unsustainable, the consequential levy of interest and penalty cannot independently survive - The authorities shall verify that the appellant had sufficient eligible ITC available under the IGST head and upon such verification, the revenue demand shall be dropped if ITC under IGST head stands unclaimed by the appellant. The appellant shall be entitled to all consequential relief including restoration or adjustment of ITC if any, in accordance with law – The appeal is allowed
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