The Calcutta High Court addressed a case involving M/s Amar Iron Udyog Pvt. Ltd. & Anr. against the Union of India & Ors. concerning the denial of Input Tax Credit (ITC) on imported goods. The issue arose because the Integrated Goods and Services Tax (IGST) paid on imports was not reflected on the GST portal due to the use of manual Bills of Entry. This led to adjudication under Section 73 of the CGST/WBGST Act, alleging excess availment of ITC and requiring reversal due to supplier default. The petitioners argued that the IGST was indeed paid, and the non-reflection was due to limitations in the Customs electronic system.
The appellate authority initially dismissed the petitioners' statutory appeal ex-parte, without addressing the merits of the evidence provided. The central issue was whether ITC could be denied solely because the IGST paid on imports was not visible on the GST portal, and whether the dismissal of the appeal without considering the evidence was justified.
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The High Court noted the confirmation from the Customs Department that IGST had been paid and attributed the non-reflection to the manual processing of Bills of Entry. The court ruled that substantive ITC should not be denied due to technical or systemic limitations beyond the control of the taxpayer. Consequently, the ex-parte appellate order was set aside, and the case was remanded to the Appellate Authority for a fresh adjudication. The authority was instructed to consider Customs records and issue a reasoned order after providing a proper hearing opportunity to the petitioners.
Parties: M/s Amar Iron Udyog Pvt. Ltd. & Anr. V. Union of India & Ors.
Order Date: 07 January 2026
Facts –
- The petitioners were subjected to adjudication proceedings under Section 73 of the CGST/WBGST Act alleging excess availment of ITC on imported goods and reversal of ITC due to supplier default.
- The department alleged that IGST paid on imports was not reflected on the GST portal, as the Bills of Entry were manually processed.
- The statutory appeal filed by the petitioners was dismissed ex-parte by the Appellate Authority without adjudication on merits.
- The petitioners contended that IGST had in fact been paid and non-reflection was due to limitations of the Customs electronic system.
Issue –
- Whether ITC can be denied merely due to non-reflection of IGST paid on imports on the GST portal, and whether dismissal of appeal without considering such evidence is sustainable?
Order –
- The High Court took note of the Customs Department’s confirmation that IGST had been duly paid and that non-reflection occurred due to manual Bills of Entry.
- It held that substantive ITC cannot be denied due to technical or systemic limitations beyond the control of the assessee.
- The ex-parte appellate order was set aside to the extent it denied ITC on imported goods.
- The matter was remanded to the Appellate Authority for fresh adjudication after considering Customs records.
- The Appellate Authority was directed to pass a reasoned order after granting proper opportunity of hearing.
