HC Sets Aside ITC Denial for Ignoring CA Certificate

Case Details: JIT Auto Comp vs. Assistant Commissioner - [2025] 176 taxmann.com 537 (Madras)

Judiciary and Counsel Details

• Krishnan Ramasamy, J.
• Ms Aparna Nandakumar & Adithya Reddy for the Petitioner.
• Rajnish Pathiyil, Special Panel Counsel for the Respondent.

Facts of the Case

The petitioner-assessee claimed Input Tax Credit (ITC) based on GSTR-3B for the relevant period. The Department compared it with GSTR-2A and found discrepancies. The assessee was unable to provide a Chartered Accountant’s certificate from their supplier as the supplier went into liquidation. However, the assessee produced a certificate from their Chartered Accountant, confirming supplies effected, goods received and payment made along with GST. The matter reached the Madras High Court.

High Court Held

The High Court held that the department should have applied its mind and arrived at a wise conclusion after verifying all transactions along with relevant documents. Since no such decision was arrived at by the department and no findings were rendered with regard to the aforesaid Chartered Accountant certificate produced by the assessee, it was clear that the department had arrived at a conclusion in a mechanical manner and passed the impugned order under section 74. Therefore, the impugned order was not sustainable in law, and the same was liable to be set aside. The matter was to be remitted back to the respondent by directing the respondent to consider the present matter as proceedings initiated under Section 73 of the GST Act and dealt with the same in accordance with the law.