Other Laws- GST ITC issues

If no GST refund/ITC claim was included in the Section 8 Demand Notice or in Form 5 of Section 9 application by Operational Creditor, it cannot become a ground of default on which CIRP under IBC can be initiated – R.B. Singh and Anr. Vs. Rashmi Cement Ltd. and Anr. – NCLAT New Delhi

In this case, Corporate Debtor had made payment of the entire operational debt as claimed by Operational Creditor in Section 8 Demand Notice and debt as reflected in Form 5 of Section 9 application. OC had not sought any GST amount in the Section 8 demand notice or Section 9 application.

Hon’ble NCLAT held that when the dues in terms of Form 3 and Form 5 have been cleared by CD, endeavours on the part of OC to seek initiation of CIRP by raising claims which do not find place in Form 3 and Form 5 filed by them, clearly manifests the intention of the OC to invoke the provision of IBC to enforce recovery of debts against the Corporate Debtor. Allowing such claims which never formed part of the claim of operational debt before the Adjudicating Authority to be considered at the appeal stage is not tenable. This cannot be commended as it militates against the spirit and essence of IBC.

If no GST refund/ITC claim was included in the Section 8 Demand Notice or in Form 5 of Section 9 application by Operational Creditor, it cannot become a ground of default on which CIRP under IBC can be initiated – R.B. Singh and Anr. Vs. Rashmi Cement Ltd. and Anr. – NCLAT New Delhi Read Post »

Issues whether input tax credit taken is in excess is the issue which could not be gone into in proceeding under Section 9 of IBC – Zaara Enterprises Venture Pvt. Ltd. Vs. Dhanraaj Agencies Pvt. Ltd. – NCLAT New Delhi

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Issues whether input tax credit taken is in excess is the issue which could not be gone into in proceeding under Section 9 of IBC – Zaara Enterprises Venture Pvt. Ltd. Vs. Dhanraaj Agencies Pvt. Ltd. – NCLAT New Delhi Read Post »

If Corporate Debtor has not deposited GST charged from the customers and Input Tax Credit (ITC) u/s 16 of CGST Act, 2017 claimed by customers has been reversed by GST Department, the customers are required to file their claim during CIRP on time | No claim can be admitted after Resolution Plan approved by CoC – Abnco Vie Win Ent Pvt. Ltd. Vs. Steamline Industries Ltd. – NCLT Mumbai Bench

In this case, Corporate Debtor has not deposited GST to government, GST department reversed ITC was taken by customers. The customer does not file claim before approval of resolution plan by CoC.
NCLT Mumbai Bench held that:
(i) The purpose of issuing public notice is to make all the interested parties/stakeholders aware of the initiation of the CIRP of the Corporate Debtor and the information memorandum which is issued subsequently, after the collection and collation of claims of the Operational and Financial Creditors to provide the Resolution Applicant so that a legally and financially sound Resolution Plan for the Corporate Debtor is received.
(ii) The Resolution Plan has been approved by the CoC as on 04.12.2019 and also has been submitted to this Tribunal for necessary approval on 20.12.2019 under Section 30 of the Code. Any interruption in the CIRP process at this stage by including the delayed claim would amount to setting the clock back. It would be complete disruption of the CIRP and the timelines stipulated therein.
(iii) IA rejected.

If Corporate Debtor has not deposited GST charged from the customers and Input Tax Credit (ITC) u/s 16 of CGST Act, 2017 claimed by customers has been reversed by GST Department, the customers are required to file their claim during CIRP on time | No claim can be admitted after Resolution Plan approved by CoC – Abnco Vie Win Ent Pvt. Ltd. Vs. Steamline Industries Ltd. – NCLT Mumbai Bench Read Post »

If dispute regarding Service Tax Credit/Refund existed prior to the issue of Demand Notice, CIRP u/s 9 cannot be initiated – Feng Ji Vs. Giesecke & Devrient MS India Pvt. Ltd. – NCLAT New Delhi

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If dispute regarding Service Tax Credit/Refund existed prior to the issue of Demand Notice, CIRP u/s 9 cannot be initiated – Feng Ji Vs. Giesecke & Devrient MS India Pvt. Ltd. – NCLAT New Delhi Read Post »

GST Input Tax Credit (ITC) available to the earlier management will not be available to the current management – M/s ESL Steel Ltd. Vs. Principal Commissioner, Central Goods & Services Tax & Central Excise – Jharkhand High Court

In this landmark decision, Hon’ble Division Bench of the High Court of Jharkhand held that on the one hand; the Additional Commissioner has illegally and arbitrarily confirmed the demand of Rs.6,02,34,616/- u/s 74(9) of the Central Goods and Service Tax Act, 2017 and imposed interest and penalty, on the ground of irregular availment of transitional credit during the period 2017-18, which includes the transitional credit of Rs.5,10,21,204/- claimed by the Corporate Debtor for the period prior to 17.04.2018 and balance amount of Rs.92,13,412/- has been claimed by the Corporate Debtor as Transitional credit by filing new TRAN-1; but at the same time the Corporate Debtor can also not take advantage of the ITC of the earlier period i.e., any dues prior to 17.04.2018; the date on which the NCLT has approved the resolution plan of the Corporate Debtor.

GST Input Tax Credit (ITC) available to the earlier management will not be available to the current management – M/s ESL Steel Ltd. Vs. Principal Commissioner, Central Goods & Services Tax & Central Excise – Jharkhand High Court Read Post »

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