M/s MO INDUSTRIES v. UNION OF INDIA & ORS. – RAJASTHAN HIGH COURT
High Court, Rajasthan
Avneesh Jhingan, Justice & Ashutosh Kumar, Justice
M/s MO INDUSTRIES
v.
UNION OF INDIA & ORS.
D.B. CIVIL WRIT PETITION No. 9660/2024 dated 08.07.2024
Law : GST
Act Name : Central Goods & Services Tax Act, 2017
Relevant Section : Section 54
Notification/Circular : Circular No.135/15/2020-GST dated 31.03.2020.
Decision : In favour of assessee
Reversal of refund of ITC – Accumulated ITC due to inverted tax structure – Writ Petition filed to challenge an appellate order that had reversed a refund of Input Tax Credit (ITC) granted earlier – Initially, refund claimed for accumulated ITC due to an inverted tax structure for the period starting from March 2021 was granted – Thereafter, the department filed an appeal against the refund order, which was quashed based on Circular No.135/15/2020-GST dated 31.03.2020 – It was argued that the Circular relied upon by the Appellate Authority was found to be repugnant and in conflict with Section 54(3)(ii) by the court in the case of Baker Hughes Asia Pacific Limited v. Union of India & Ors. – Appellate Authority only partially cited the judgment in Baker Hughes Asia Pacific Limited and unjustly accepted the Department’s appeal – Held that – The court referred to the decision in Baker Hughes Asia Pacific Limited, where the Circular dated 31.03.2020 was held to be repugnant and conflicting with Section 54(3)(ii) of the CGST Act. The court had ruled that the Circular, being subordinate legislation, could not override the parent legislation – Noted that the Appellate Authority’s reliance solely on the Circular, which had been judicially invalidated, was not sustainable – Impugned order of the Appellate Authority set aside, matter was remitted back to the Appellate Authority to decide the appeal afresh, in accordance with the law, without solely relying on the invalidated Circular – Writ Petition allowed.
Represented By:
Counsel for the Petitioner: Ravi Gupta, Advocate
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