The GSTAT, Thiruvananthapuram Bench in M/s. Santhome Latex Enterprises v. The Commissioner of CGST, Thiruvananthapuram [Appeal No. APL/21/TVP/2026, Final Order No. 04/TVP/KERALA/2026 dated August 21, 2026] set aside the Order-in-Appeal which had reversed the adjudication order dropping the demand of ineligible Input Tax Credit (“ITC”) raised under Section 74 of the Central Goods and Services Tax Act, 2017 (“the CGST Act”), and held that the mere act of taking ineligible self-assessed ITC in the Electronic Credit Ledger, or the mere failure to reply to an audit enquiry or final audit report, does not amount to “suppression of facts” so as to invoke Section 74 of the CGST Act, unless the Department establishes by evidence that the taxpayer knew that the credit was ineligible and, in a contumacious act, still went ahead and took it. The GSTAT further held that an Appellate Authority cannot sustain a Section 74 demand on a ground that is not found in the Show Cause Notice.
CLICK HERE FOR OFFICIAL JUDGMENT COPY
(Author can be reached at info@a2ztaxcorp.com)
DISCLAIMER: The views expressed are strictly of the author and A2Z Taxcorp LLP. The contents of this article are solely for informational purpose and for the reader’s personal non-commercial use. It does not constitute professional advice or recommendation of firm. Neither the author nor firm and its affiliates accepts any liabilities for any loss or damage of any kind arising out of any information in this article nor for any actions taken in reliance thereon. Further, no portion of our article or newsletter should be used for any purpose(s) unless authorized in writing and we reserve a legal right for any infringement on usage of our article or newsletter without prior permission.
