Facts of the Case

The petitioner, Shri Krishana Ravi, a contractor aged 58 from Bagalkot District, Karnataka, holding GSTIN 29AFCPR0045K1ZC, filed a writ petition under Articles 226 and 227 of the Constitution seeking to strike down Section 16(4) of the CGST/SGST Act, 2017 read with Rule 61 of the KGST Rules and Rule 61(5)/Notification No.49/2019-Central Tax as unconstitutional, or alternatively read down as directory, and to quash a notice dated 26.12.2021 (No. ACCT/LGSTO-430/BGV/141/21-22/B-629) issued by the Assistant Commissioner of Commercial Taxes, LGSTO-430, Jamkhandi (respondent no.1). The matter was heard by the Dharwad Bench on 17 November 2023.

Issues Involved

  1. Whether Section 16(4) of the CGST/SGST Act, 2017 and the associated KGST Rules restricting the time limit for claiming input tax credit are unconstitutional.
  2. Whether the impugned notice dated 26.12.2021 could be quashed directly in writ jurisdiction without first exhausting the statutory remedy.

Petitioner's Arguments

  • Challenged Section 16(4) and Rule 61(5) as illegal, unreasonable, arbitrary and discriminatory, violating Articles 14, 19 and 300A of the Constitution.
  • Sought, in the alternative, that the ITC time-limit provision be read down as directory rather than mandatory.
  • At the hearing, chose not to press the constitutional challenge or the read-down prayer, and placed this submission on record.

Respondent's Arguments

  • Section 16(4) of the CGST/SGST Act read with Rule 61(5) has already been upheld as constitutional in Thirumalakonda Plywoods v. The Assistant Commissioner (Andhra Pradesh High Court) and Gobinda Construction v. Union of India (Patna High Court).
  • Relied on the Supreme Court's decisions in Jayam and Company v. Assistant Commissioner, (2016) 15 SCC 125, and ALD Automotive Pvt. Ltd. v. Commercial Tax Officer, (2019) 13 SCC 225, upholding a similar time-limit restriction under the Tamil Nadu VAT Act.
  • Submitted that the constitutional challenge deserved to be rejected in light of these precedents.

Court Order/Findings

  • As the constitutional challenge was not pressed, the Court did not examine the validity of Section 16(4) or Rule 61(5).
  • The writ petition was disposed of without expressing any opinion on the merits of the impugned notice, leaving the petitioner at liberty to avail the statutory appellate remedy under the CGST/KGST Act.
  • Time spent in prosecuting the writ petition was directed to be excluded while computing limitation for any subsequent appeal or reply to the notice.

Important Clarification

  • A petitioner who withdraws a constitutional challenge to Section 16(4) of the CGST Act mid-hearing is relegated to the statutory appellate remedy, and the writ court will not independently adjudicate the merits of the underlying ITC denial or notice.
  • Courts consistently protect the litigant's limitation period by excluding time spent in the unsuccessful writ proceeding.
  • The order reflects a broader pattern across High Courts of declining to entertain fresh constitutional challenges to Section 16(4) once its validity has been upheld elsewhere (citing Thirumalakonda Plywoods and Gobinda Construction).

Sections Involved

  • Section 16(4), CGST Act, 2017 — prescribes the time limit for availing input tax credit.
  • Rule 61(5), KGST Rules, 2017 read with Notification No. 49/2019-Central Tax — procedural provisions tied to the ITC time-limit.
  • Articles 226 and 227, Constitution of India — writ jurisdiction invoked.

Decision – In Favour of

Disposed of with directions, without a finding for either side on merits — the petitioner retains liberty to pursue the statutory remedy against the notice; this is a procedural rather than substantive outcome.

Related Case Laws

No directly on-point case notes are currently published on this site.

Case Details

  • Court: High Court of Karnataka, Dharwad Bench
  • Case No.: WRIT PETITION NO. 104149 OF 2022 (T-IT)
  • CNR: Not available on record
  • Coram: Hon'ble Mr. Justice Anant Ramanath Hegde
  • Decision Date: 17 November 2023
  • Disposal Nature: Disposed of (constitutional challenge not pressed; liberty to pursue statutory remedy)

Link to Download the Order

Download the full judgment (PDF)

Disclaimer

This content is shared strictly for general information and knowledge purposes only. Readers should independently verify the information from reliable sources. It is not intended to provide legal, professional, or advisory guidance. The author and the organisation disclaim all liability arising from the use of this content. The material has been prepared with the assistance of AI tools.