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2023 (10) TMI 639 - DELHI HIGH COURTDenial of refund of the unutilized Input Tax Credit (ITC) - inverted duty structure - Denial on the ground that the one of the suppliers had erroneously mentioned HSN 6404 in respect of the goods supplied in its invoices notwithstanding that it had also furnished the certificate acknowledging the same - HELD THAT:- The controversy relates to the six invoices issued by one of the suppliers (M/s V.K. Polymers). Undisputedly, the said supplier had charged the GST at the rate of 18% which is chargeable on PVC straps. There is no cavil that the tax chargeable on footwear (compete finished products) is 5% or 12%, depending on the value of the said product. The supplies made by M/s V. K. Polymers under the six invoices in question, were below the price of ₹1,000/-. Thus, if the said supplier had supplied a complete product, it would have charged GST at the rate of 5%. According to the petitioner, the petitioner had produced a certificate from the said supplier acknowledging that it had incorrectly classified the goods under HSN 6404 instead of HSN 6406. The fact that the GST had been charged by the said supplier at the correct rate is a material factor to be considered by the Adjudicating Authority. Whilst the concerned authorities have accepted the classification of the product supplied by a singular supplier, M/s V. K. Polymers, under six invoices, as correct; they have not accepted the classification of goods as far as the other suppliers are concerned. This is notwithstanding that there is no dispute that all suppliers have correctly charged the GST. Whether the petitioner would be entitled to the refund notwithstanding that the ITC availed for the month of October, 2020 and November, 2020 was in excess of the limit as specified in Rule 36(4) of the CGST Rules? - HELD THAT:- It is material to note that the learned counsel appearing for the respondents does not dispute that if the petitioner is correct that the mismatch is only on account of the suppliers filing the quarterly returns, the petitioner would be entitled to the refund. He, however, states that the petitioner did not submit the relevant documents to establish this claim - the learned counsel appearing for the parties state that in the aforesaid circumstances, the matter be remanded to the Adjudicating Authority to consider the matter afresh, with liberty to the petitioner to produce all the documents as to substantiate its claims. The matter is remanded to the Adjudicating Authority to consider the petitioner’s claim regarding availing ITC in excess of the limit as prescribed under Rule 36(4) of the CGST Rules - petition allowed by way of remand.
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