Matter Remanded as Order Was Passed Without Considering the Newly Inserted Provision of Section 16(5) | HC

Case Details: ITI Ltd. vs. Union of India - [2025] 172 taxmann.com 59 (Gauhati)

Judiciary and Counsel Details

• Vijay Bishnoi, CJ. & N. Unni Krishnan Nair, J.
• Puneet Agarwal & H. Betala, Advs. for the Petitioner.
• S.C. Keyal, S.C. for the Respondent.

Facts of the Case

The petitioner, an assessee under the Central Goods and Services Tax Act, 2017 (CGST Act), filed a writ petition challenging the validity of Section 16(4) of the CGST Act and seeking quashing of Notification No. 9/2023-Central Tax, Dated 31-03-2023, which extended the time limit for passing orders under Section 73. The dispute arose from an order whereby the respondent authority imposed certain demands without considering the newly inserted provision of Section 16(5). The petitioner contended that the insertion of Section 16(5) had substantively addressed its concerns regarding the availment of Input Tax Credit (ITC), yet the impugned order was passed without affording an opportunity of hearing. The Revenue submitted that the matter could be remitted for fresh adjudication.

High Court Held

The Hon’ble High Court held that the impugned order was unsustainable as it was passed without considering the newly inserted Section 16(5) of the CGST Act. The Court observed that the petitioner’s grievance regarding ITC had been substantially addressed by the amendment, and the order under challenge failed to account for this legislative change. Consequently, the Court set aside the impugned order and remanded the matter to the respondent authority for a fresh decision, directing that the case be re-adjudicated in accordance with the amended provisions of Section 16 of the CGST Act, after providing the petitioner with an opportunity of hearing, within two months from the date of submission of a certified copy of the order.