Cross-Charge Mechanism Valid for Distribution of Common ITC Prior to April 01, 2025
Last updated: 07 April 2026
Court :
Karnataka High Court
Brief :
The Hon’ble Karnataka High Court in the case of M/s. Micro Labs Limited v. Joint Commissioner of Central GST & Ors. [WP No. 8409 of 2025, order dated December 09, 2025] held that distribution of common input tax credit (ITC) through cross-charge mechanism by raising invoices under Section 31 of the CGST Act is permissible, and any order passed in disregard of the CBIC’s Circular No. 199/11/2023-GST dated July 17, 2023 is illegal, arbitrary, and without jurisdiction.
Citation :
WP No. 8409 of 2025, order dated December 09, 2025
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Bimal Jain
Published in GST
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