Summary
- The Supreme Court has issued notice on a constitutional challenge to Section 16(2)(c) of the CGST Act, questioning whether bona fide buyers can lose Input Tax Credit (ITC) due to supplier default.
- Recent High Court rulings emphasize that genuine purchasers should not be penalized for supplier non-compliance, with the Allahabad and Tripura High Courts advocating for fairness in ITC claims.
- The divergence in judicial opinions highlights a critical moment for businesses navigating GST compliance, as the final interpretation may significantly impact their rights.
- Until the Supreme Court's decision, businesses are advised to maintain rigorous documentation and compliance practices to safeguard their ITC claims.
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