Kesarwani Traders Vs State of Up And 3 Others (Allahabad High Court)
The Allahabad High Court has upheld a company’s ITC claim, quashing a tax order that denied it. The court found that a stamped e-Way bill proved goods movement, invalidating the ‘paper transaction’ claim. It allows ITC claim as e-Way bill confirms actual goods movement, despite supplier’s GST registration being cancelled after the transaction.
The Allahabad High Court has quashed an order from the State Tax authorities and upheld the Input Tax Credit (ITC) claim of Kesarwani Traders, a registered dealer of TMT bars. The court ruled in favor of the company, finding that the tax authorities had incorrectly denied its ITC claim based on a “paper transaction” allegation, despite clear evidence of goods movement and a valid GST registration for the supplier at the time of the transaction.
The case stemmed from a “Bill to Ship to” transaction where Kesarwani Traders placed an order with its supplier, M/s Purvanchal Tradelink India, which in turn procured the TMT bars from another supplier, SM Shop in Chhattisgarh. The goods were transported with a valid e-Way Bill. A key piece of evidence was the fact that the e-Way Bill was intercepted and physically stamped by a mobile squad in Chhattisgarh on June 21, 2018, confirming the actual movement of the goods.
