Patanjali Foods Limited Vs State of Assam And 4 Ors. (Gauhati High Court)
The writ petition before the Gauhati High Court was filed by a public limited company registered under the Central Goods and Services Tax Act, having its principal place of business in Guwahati and engaged in the FMCG sector in Assam. The petition challenged four Show Cause Notices dated 22.09.2025 issued under Sections 73 and 74A of the State GST Act, 2017. Through these notices, the State authorities alleged that the petitioner had wrongly availed Input Tax Credit (ITC) in violation of Clause 8 of the Assam Industries (Tax Reimbursement for Eligible Units) Scheme, 2017, and sought reversal of the ITC amounts specified therein.
Clause 8 of the Reimbursement Scheme restricts availability of ITC on inter-State supplies where goods are manufactured by units eligible under the reimbursement scheme and provides that proportionate ITC would lapse. The petitioner contended that the vires of Clause 8 itself were unconstitutional and beyond the powers of the State. It was argued that denial of ITC through a reimbursement scheme conflicted with Articles 246A and 279A of the Constitution of India and Sections 16 and 164 of the CGST Act, read with Section 2(87). According to the petitioner, the State lacked jurisdiction to curtail statutory ITC entitlement conferred under the GST law.
