GST
TRT-2025-
Bombay High Court
Date:-10-07-25
In:-
Issue Favourable to Tax Payer ?:-
Order Date – 10 July 2025
Parties: Umicore Autocat India Private Limited Vs Union of India, Goods and Services Tax Network, Central Board of Indirect Taxes
and Customs, The Goods and Services Tax Council (GST Council), The State Tax Officer and The Commissioner, CGST
Facts –
- The Petitioner, Umicore Autocat India Private Limited, amalgamated with Umicore Anandeya India Pvt. Ltd. (Goa) attempted to transfer the unutilized ITC of the dissolved Goa entity via Form ITC-02 on the GST portal, it was rejected on the ground that both entities were not registered in the same State.
- The GSTN system cited technical limitations based on circulars and business logic. The petitioner challenged this restriction before the Hon’ble High Court.
Issue –
- Whether the unutilized Input Tax Credit (ITC) can be transferred from a transferor company registered in one State to a transferee company registered in another State?
Order –
- The Division Bench of the Hon’ble High Court observed that had the legislature had any intention to cast an embargo or impose a restriction with reference to sub-section (4) of Section 22 to the effect that, unless and until the Transferee is registered, ITC cannot be availed, it should have so specified, but sub-section (3) is merely suggestive of allowing the transfer of the un-utilized ITC in the electronic credit ledger of the Transferor to the Transferee, whenever there is change in the constitution of the registered person on account of sale, merger, demerger, amalgamation, lease or transfer of the business with a specific provision of transfer of liability.
- Now the difficulty that is sought to be projected for not giving effect to sub-section (3) of Section 18 on the part of the Respondents-Authorities is that the GSTN portal does not allow such transfer. This, according to the Court, can be no ground to deny the benefit to the Petitioner, if it is so entitled in the wake of the statutory scheme.
- In the peculiar circumstances, the Court permitted the IGST and CGST amount lying in the electronic credit ledger of the Transferor Company to be transferred to the Petitioner Company by physical mode for the time being, subject to the adjustments to be made in future. However, we also request the GST Council as well as the GST Network to provide for mechanism to deal with such contingencies, when the ITC is sought to be transferred from one State to another or from one State to any Union Territory by updating its network to deal with such a situation.
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