Eris Lifesciences Ltd. Vs Union of India & Ors. (Gujarat High Court)
The Gujarat High Court is set to review a petition from Eris Lifesciences Ltd. challenging a tax demand of ₹1,28,52,421. The demand, confirmed by both the original and appellate orders, is for the reversal of Input Tax Credit (ITC) on pharmaceutical products that were returned to the company after their expiration date.
The core of the petitioner’s argument is that once these expired drugs are returned, they are subsequently destroyed as per guidelines from the Central Drugs Standard Control Organization. The company contends that this destruction does not constitute the destruction of goods on which they paid output tax, as the goods had already been sold. Therefore, the company argues that the provision under Section 17(5)(h) of the Central Goods and Services Tax (CGST) Act, 2017, which governs the destruction of goods and the reversal of ITC, should not be applied in this specific scenario. The company further challenges a provision in Notification No. 72/46/2018-GST, arguing that it is not applicable when a credit note for returned, expired goods is issued after the deadline specified in Section 34(2) of the CGST Act.
The High Court, after hearing the initial submissions, has issued a notice and scheduled the next hearing for September 18, 2025.
