2026-VIL-1239-KAR
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SGST High Court Cases

GST - Refund of unutilised Input Tax Credit accumulated due to inverted tax structure - Section 54(3)(ii) of the CGST Act, 2017 - Respondent was awarded a contract for construction of elevated structures, including viaduct and stations, for a metro rail project, where the supply attracted a lower rate of GST while most inputs carried higher rates, due to which ITC accumulated – Dept rejected the refund claim, holding that the supply fell under sub-item (b) of Item 5 of Schedule II of the CGST Act, being construction of a complex, building or civil structure, in respect of which refund of unutilised ITC was not permissible by notification - Whether the supply made by the Respondent is a composite supply of works contract under Item 6 of Schedule II or construction service under Item 5(b) of Schedule II, and whether refund could be denied on that ground - HELD - Works contract as defined in Section 2(119) is a composite supply under Item 6 of Schedule II. There was no dispute that the activities of the Respondent are covered under the definition of works contract, as neither the Adjudicating Authority nor the Appellate Authority disputed it; the averments in the appeal did not dispute it, and the Appellate Authority itself recorded that the Respondent undertook works contract services - The Revenue's contention that the contract was not examined was at variance with its own case in the appeal. There is no doubt that the Respondent is engaged in providing composite supplies under Item 6, and the refund claim could not be denied on the ground that the services fell within clause (b) of Item 5 of Schedule II to CGST Act - The view of the learned Single Judge is upheld and the appeal is dismissed on merits - GST - Condonation of delay in filing writ appeal by Revenue - The Revenue filed a writ appeal against the order of the learned Single Judge after a delay of 402 days, and sought condonation on the ground that the certified copy was received in April 2025, the file was placed before the concerned officer only in December 2025, and the opinion of the law office, the Government Order and the finalisation of the appeal took further months - Whether the delay can be condoned - HELD - There was no explanation why the judgment was not even placed before the concerned officer for more than ten months after the copy was available with the Department. The delay exceeded a reasonable period, and there were no grounds to justify that the appellant was prevented from filing the appeal within the stipulated period - The appeal is dismissed on account of delay.
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