Kerala High Court Mandates Reconsideration of ITC Denied Due to Delayed GST Returns

In a significant judicial intervention, the Kerala High Court has provided relief to an assessee facing the denial of Input Tax Credit (ITC) due to the belated filing of GST returns. The ruling in the case of A. R. Thaha Muhammed Vs Assistant State Tax Officer centers on the interpretation and application of the newly inserted Section 16(5) of the CGST Act, which offers a specific window of relaxation for claiming ITC that was otherwise barred by the strict timelines of Section 16(4).

The Court's directive to the assessing authority to reconsider the ITC claim underscores the legislative intent behind providing retrospective relief for specific assessment years, provided the assessee meets the extended statutory deadlines.

Factual Matrix of the Dispute

The legal proceedings originated when the assessee, holding a valid registration under the CGST/KGST Act, challenged an Order-in-Original issued by the tax authorities. The assessment in question pertained to the Assessment Year 2019-2020.