Key Principles from the Supreme Court’s GST Jurisprudence
- Safari Retreats (2024) – ITC on Construction of Buildings for Lease
- Supreme Court held that immovable property built for leasing/renting can qualify as “plant” under Section 17(5)(d).
- Input Tax Credit (ITC) allowed if the property directly facilitates output services like rentals.
- Liberal interpretation favored taxpayers, distinguishing between buildings for sale (disallowed) vs. buildings for services (allowed).
- Bharti Airtel (2024) – CENVAT/GST Credit on Towers & Prefabricated Buildings
- Telecom towers and prefabricated buildings remain “goods” even if fixed; dismantling and relocation possible.
- Such infrastructure is essential for telecom services and qualifies as “inputs.”
- Broader interpretation adopted—credit allowed under both CENVAT and GST regimes.
- Aberdare Technologies (2025) – Rectification of Bona Fide Errors
- Supreme Court allowed correction of return-filing errors beyond statutory deadlines where no revenue loss occurred.
- Emphasized pragmatic, revenue-neutral approach to genuine taxpayer mistakes.
- Suncraft Energy (2023) – ITC Cannot Be Denied for Supplier’s Default
- ITC cannot be reversed solely because supplier failed to report invoice in GSTR-2A.
- Buyer’s compliance under Section 16(2) (valid invoices, payment, return filing) is sufficient.
- Department must first proceed against defaulting supplier, not the bona fide buyer.
Tribunal’s & Court’s Broader Findings
- GST framework requires purposive and pragmatic interpretation.
- Input Tax Credit scope is expanding, protecting genuine taxpayers.
- Courts prioritize substance over form, focusing on economic reality and fairness.
Key Takeaway
- GST law is steadily evolving through judicial clarity.
- Taxpayers benefit when courts:
- Recognize functionality (Safari Retreats, Bharti Airtel).
- Allow corrections for bona fide mistakes (Aberdare).
- Prevent penalizing recipients for supplier defaults (Suncraft).
- Businesses should track evolving jurisprudence to safeguard compliance, litigation strategy, and refund positions.
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(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.)
