The Sikkim High Court in SICPA India Pvt. Ltd. v. UOI allowed refund of unutilized ITC after business closure, reigniting debate under GST.
Case Summary:
- Petitioner shut business, reversed ITC, and sought ₹4.37 crore refund under Section 49(6).
- Authorities rejected it, citing Section 54(3) permits refunds only for zero-rated or inverted duty supplies.
Court’s View:
- There is no bar under Section 49(6) or 54(3) against refund on closure.
- Cited Slovak India case to uphold taxpayer rights.
- Stressed that statutory silence shouldn’t deny refund when no further taxable activity exists.
Caution:
- Conflicting precedents (VKC Footsteps, Gauri Plasticulture) show the issue remains legally unsettled.
Conclusion:
A progressive move, but the refund right on closure still awaits Supreme Court clarity or legislative change.
Read the full article here:
https://vilgst.com/showiframe?V1Zaa1VsQlJQVDA9=TVRjd09BPT0=&page=articles
PDF also attached for convenience
Would love to hear your views and thoughts on this continuing debate.
(The author is a practicing advocate, Co-Founder and Legal Head of RB LawCorp.
He specializes in GST law. Suggestions or queries can be directed to
ashsharma@rblawcorp.in. The views expressed in this article are strictly
personal.)
