ITC Cannot Be Denied if Section 16(5) Cut-Off Is Met | HC

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Section 16(5) ITC Cut-Off

Case Details: Deepam Palm Dish v. State Tax Officer [2026] 187 taxmann.com 907 (Kerala)

Judiciary and Counsel Details

  • Ziyad Rahman A.A., J
  • Smtg. Mini, P.J. Anil Kumar, Satyajith K. Warrier, P.S. Sree Prasad, Advs & A. Kumar, Sr. Adv. for the Petitioner. 
  • Shaij Raj T.K., GP for the Respondent.

Facts of the Case

The petitioner, a registered taxpayer, claimed input tax credit (ITC) for April 2018 and March 2019. The department denied the ITC through an order passed under Section 73 on the ground that the relevant returns had not been furnished within the time limit prescribed under Section 16(4). The petitioner contended that the returns had been filed on 15.02.2021 and 27.02.2021, i.e., within the special cut-off date of 30.11.2021 prescribed under Section 16(5), and therefore the benefit of ITC could not be denied.

High Court Held

The High Court held that since the returns were filed within the cut-off date prescribed under Section 16(5), which contains a non-obstante clause overriding Section 16(4), the general time limit under Section 16(4) ceased to apply. Accordingly, denial of ITC solely on the basis of Section 16(4) was unsustainable. The impugned order was quashed and the matter was remanded for reconsideration of the petitioner’s entitlement to the benefit of Section 16(5), if otherwise eligible.

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Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied