WHAT IS THE PRINCIPLE OF UNJUST ADJUSTMENT

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WHAT IS THE PRINCIPLE OF UNJUST ADJUSTMENT
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Unjust enrichment has been defined as: "A benefit obtained from another, not intended as a gift and not legally justifiable, for which the beneficiary must make restitution or recompense." A claim for unjust enrichment arises where there has been an "unjust retention of a benefit to the loss of another or the retention
The principle of unjust enrichment would apply only if the revenue has cogent evidence that the incidence of tax has been passed on to another person.

For Example : 1. As per the proviso to section 34(2) of CGST Act state that " no reduction in output tax liability of supplier shall be permitted of the incidence of tax & interest on such Supply has been passed on to any other person" So in this case Supplier is liable to reduce his tax liability only when the recipient has reduced his ITC .

Example 2 : As per Section 54(8) of CGST Act the Unjust enrichment principal does not apply when refund is claimed in respect to:the Tax (IGST) paid in making outward zero-rated supplies, because there is no incidence of tax is passed.


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