Retrospective Section 16(5) protects ITC claims where returns were filed by 30 November 2021.

The petitioner challenged an adjudication order dated 1 December 2023 under Section 73 of the CGST/KGST Acts, concerning input tax credit (ITC) for July 2017 to March 2018.

The petitioner had filed the corresponding returns between April and August 2019, after the original due dates but before 30 November 2021.

The petitioner relied on the retrospective insertion of Section 16(5), effective from 1 July 2017, which addresses ITC for specified earlier tax periods where returns were filed by 30 November 2021.

The Court considered the challenge to the adjudication order and the applicability of that amendment.

1. Whether the petitioner’s delayed filing of returns defeated its claim to ITC for the relevant period, notwithstanding the retrospective insertion of Section 16(5).

2. Whether the adjudication order should be set aside and the matter reconsidered in light of Section 16(5).

Section 16(5) of the CGST/KGST Acts, retrospectively effective from 1 July 2017, permits a registered taxable person to claim ITC for the specified tax periods, including 2017–18, where the relevant return is filed up to 30 November 2021.

The adjudication was made under Section 73(9) of the Acts.

The petitioner’s returns related to the tax period covered by Section 16(5) and had been filed before 30 November 2021.

The Court therefore considered the petitioner entitled to ITC in light of the retrospective amendment and concluded that the adjudicating authority should reconsider the matter and issue a formal order applying that provision.

The proceedings were restored to the first respondent to pass a formal order in light of the Court’s observation that the petitioner was entitled to ITC under retrospectively inserted Section 16(5).

The petitioner was permitted to submit a certified copy of the judgment; the first respondent was directed to communicate the order by 30 November 2026, following the timeline stated in the judgment.