VAT appeals admitted to examine subcontract deductions and input tax credit denial to bona fide purchasers.

The appeals arose from a common judgment and order of the Maharashtra Sales Tax Tribunal, Mumbai, dated 18 November 2025, in VAT Second Appeals Nos. 107–112 of 2022.

The High Court noted that the appellant had raised common substantial questions of law across the appeals.

The order does not set out the underlying transactions or the Tribunal’s detailed findings.

1. Whether, on a proper interpretation of the Maharashtra Value Added Tax Act, 2002 and the Rules, the deduction for subcontract payments under Rule 58(1)(b) of the Maharashtra Value Added Tax Rules, 2005 is independent and absolute, or conditional upon Section 45(4) of the Act.

2. Whether Section 48(5) of the Act permits denial of input tax credit to a bona fide purchaser without an allegation of fraud, collusion or connivance, particularly where the State has not pursued recovery from the defaulting selling dealer, despite an undertaking given to the High Court.

The substantial questions concerned Rule 58(1)(b) of the Maharashtra Value Added Tax Rules, 2005, and Sections 45(4) and 48(5) of the Maharashtra Value Added Tax Act, 2002.

The High Court did not determine the meaning or application of these provisions at this stage; it admitted the appeals on the questions framed for consideration.

The Court recorded that the appeals raised common substantial questions of law concerning deductions for subcontract payments and denial of input tax credit.

After hearing the appellant’s counsel and perusing the questions, it admitted the appeals without deciding either question on its merits.

The order therefore contains no final interpretation of the cited statutory provisions.

The appellant withdrew the connected interim applications with liberty to file afresh when appropriate, and the applications were disposed of on that basis.