The applicant has adopted a very technical approach in analyzing the due date of availing ITC. From a plain reading of the Act, it appears that the intention of the legislature is to restrict the time limit for availing ITC upto the due date of furnishing of return of September of the following year, regardless of whether the said return is GSTR-3 or GSTR-3B. It would be interesting to see the government’s counter-submissions in the next hearing scheduled for 9 January 2019. If the court accepts the contentions of the applicant, there is a possibility that the due date for availing ITC can be extended up to the date of filing of annual return, i.e., 31 March 2019.
Many taxpayers have already written off the unavailed ITC in relation to the preceding financial year in their books of accounts. Any re-availment of such written off ITC in view of the judgment in this case should be carefully evaluated to determine implications under direct tax laws as well.
It should be noted that the court has not passed any order or provided any interim relief to the businesses. Taxpayers are well-advised to not rely on the messages circulating on various social media platforms, suggesting that the court has struck down the time limit for claiming ITC in respect of the period July 2017 to March 2018.