Sri Gurucharan Kangsa Banik Vs Union of India and Anr (Gauhati High Court)
Input Tax Credit Cannot Be Denied Solely for Supplier’s Failure to Deposit GST; Bona Fide Purchasing Dealer Cannot Be Punished for Supplier’s Tax Deposit Failure; GST Demand Set Aside Because ITC Denial Was Based Only on Supplier’s Non-Payment of Tax; Gauhati High Court Rules ITC Cannot Be Rejected Where Purchaser Complied with Statutory Conditions; Purchasing Dealer Protected from ITC Denial Because Supplier’s Default Was Beyond Its Control; ITC Disallowance Quashed Because Department’s Remedy Lies Against Defaulting Supplier.
In Sri Gurucharan Kangsa Banik v. Union of India and Another, the Gauhati High Court considered a challenge to an Order-in-Original dated 28 March 2024 passed by the Assistant Commissioner, Central Goods and Services Tax & Central Excise Division, Silchar. The impugned order confirmed a tax demand of ₹69,56,794, comprising IGST of ₹50,19,230, CGST of ₹9,68,782, and SGST of ₹9,68,782 for the period from July 2017 to March 2019. Interest under Section 50 of the CGST Act, 2017 and corresponding provisions of the SGST and IGST Acts was also directed to be recovered, and an equivalent penalty was imposed under Section 74(1) read with Section 122 of the CGST Act and Section 20 of the IGST Act.
