Order Date – 10 June 2025

Parties: SICPA India Private Limited and Another Vs Union of India and Others

Facts –

• The Petitioner, SICPA India Private Limited, had discontinued its business in Sikkim and sold off its manufacturing assets between April 2019 and March 2020 and filed a refund claim on unutilized Input Tax Credit.
• The refund claim was rejected on the ground that closure of business is not a valid reason for refund under Section 54(3) of the CGST Act.

Issue –

• Whether a registered person is entitled to refund of unutilized ITC upon discontinuance or closure of business?

Order –

• The Single Bench of Hon’ble High Court observed that in the instant matter there is no express prohibition in Section 49(6) read with Section 54 and 54(3) of the CGST Act, for claiming a refund of ITC on closure of unit. Although, Section 54(3) of the CGST Act deals only with two circumstances where refunds can be made, however the statute also does not provide for retention of tax without the authority of law.
• Hence it was held that the Petitioners are entitled to the the refund of unutilized ITC claimed by them.
• Writ Petition is accordingly allowed and disposed of.