Madras High Court Extends Input Tax Credit Benefit Before-Amendment Transactions

Madras High Court Extends Input Tax Credit Benefit Before-Amendment Transactions

The Court allowed the petition as the Respondent did not object to the contentions raised

The Madras High Court extended the benefit of Input Tax Credit in respect of the transactions that occurred prior to the issue of amendment in the Tamil Nadu Act 5 of 2015.

The matter titled M/s Nezone Tubes Limited v The Assistant Commissioner was placed before a single-judge Court of Justice S.M. Subramaniam in the High Court of Madras.

There was no factual matrix involved in this matter and the challenge involved was only a legal issue. The Petitioner – Company contended that the amendment was effected by way of rectification of an anomaly and therefore, it could not be construed as a new policy. Due to this reason, the Petitioner further contended that the benefit of Input Tax Credit granted pursuant to the amendment should be extended in order to cover the transactions, which took place prior to the insertion of the amendment.

The Respondent – Authority was not able to object to the said contentions raised by the Petitioner.

Reliance was placed by the Petitioner on the judgment of the Madurai Bench of the High Court in a batch of Writ Petitions led by W.P.(MD).No.15103 of 2015 whose order was pronounced on 30 August 2019.

The Court went through the judgement and felt inclined to follow the decision in that case where the said benefit was extended to the petitioner therein and the order had become final since no appeal was sought later.

The Court allowed the petition, on the basis of the aforesaid judgment.