Recent Judgment of Honorable Gujarat High Court in case of VKC Footsteps India Pvt. Ltd. vs. Union of India

Last updated: 03 September 2020

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The Gujarat High Court has ruled that a specific rule within the CGST Rules (Rule 89(5)) is invalid as it unfairly excludes input services from refund claims for unutilised input tax credit. The court found this contradicts the broader provisions of the CGST Act, which allows refunds on any unutilised input tax credit. Consequently, businesses can now claim refunds that include input tax credit on input services.

Court :
Gujarat High Court

Brief :
High Court held that by prescribing the formula in Sub-rule 5 of Rule 89 of the CGGST Rules,2017 to exclude refund of tax paid on 'input service' as part of the refund of unutilised input tax credit is contrary to the provisions of Sub-section 3 of Section 54 of the CGST Act,2017 which provides for claim of refund of 'any unutilised input tax credit'.

Citation :
VKC Footsteps India Pvt. Ltd. vs. Union of India

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Judgement posted by

CA Shruti Singhal

Practicing CA

CA Shruti Singhal, an alumna of Jesus and Mary College, DU (B.Com (H)), did her articleship from Grant Thornton. Post qualification she worked at Singhal and Associates, a CA firm based out of Connaught Place. Shifting her focus only to Indirect Taxes, she opened a Sole Proprietor Firm, namely, Shruti Singhal Co. She ... Read more

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