M/s S & D SALES MARKETING v. THE DEPUTY COMMISSIONER OF STATE TAX & ORS.

Introduction

This judgment reinforces the principle that the Electronic Credit Ledger under the GST regime functions as a common pool of Input Tax Credit (ITC), with separate compartments for CGST, SGST, and IGST. Relying upon its earlier landmark decision in Rejimon Padickapparambil Alex v. Union of India (2024 KHC Online 7215), the Kerala High Court held that IGST credit can be utilized for discharging CGST and SGST liabilities and vice versa, subject to the statutory scheme. Consequently, the Court set aside the adjudication and appellate orders denying ITC and remanded the matter for fresh consideration.

Background of the Case

The petitioner, a proprietary concern engaged in the business of trading rice and dairy products, was a registered taxpayer under the CGST Act.