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May 2023

Goods and Services Tax

By Puloma Dalal | Jayesh Gogri | Mandar Telang
Chartered Accountants
Reading Time 17 mins
I. SUPREME COURT 9. State of Karnataka vs. Ecom Gill Coffee Trading Pvt Ltd (2023) 4 Centax 223 (SC) Date of order:  13th March, 2023 A burden to prove goods were actually received for the genuineness of ITC claimed was on the purchaser and not on Department    FACTS The respondent was a dealer in coffee beans. The Adjudicating Authority issued a show cause notice after noticing some irregularities in the availment of ITC claimed by the respondent. The authority denied ITC on the grounds of doubt in the genuineness of purchases made since registrations of sellers were cancelled/they had filed nil returns. The Appellate Authority also rejected the Respondent’s claim. However, the Tribunal ruled in favor of the Respondent and allowed ITC considering that payments were made through bank transactions against proper invoices. The high court affirmed the Tribunal order. Being aggrieved by such an order, the Department filed an appeal before Hon’ble Supreme Court. HELD The Hon’ble Supreme Court held that the burden of proving the genuineness of claiming ITC remains on the respondent. Merely producing invoices or substantiating payment through a bank was not sufficient to prove the actual receipt of goods. Furnishing cogent material like the name and address of the selling dealer, details of the vehicle which has delivered the good
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