West Bengal AAR Denies Reclaim of Reversed ITC Despite Retrospective Section 16(5) Amendment

In re Eastern Coalfields Ltd. (GST AAR West Bengal) Summary: The West Bengal Authority for Advance Ruling (AAR) considered whether Eastern Coalfields Limited (ECL) could reclaim Input Tax Credit (ITC) that had earlier been reversed pursuant to an advance ruling dated 09.08.2021, in light of the retrospective insertion of Section 16(5) into the CGST Act by the Finance (No. 2) Act, 2024 with effect from 01.07.2017. ECL had entered into a Longwall Mining Project Agreement with China Coal Overseas Development Co. Ltd. (CODCO) for coal extraction. Under the arrangement, CODCO assigned its rights an...