Supreme Court Rules Tata Steel Has Locus Standi To Challenge Denial Of Input Tax Credit To Its Unit
Parina Katyal
1 March 2022 3:01 AM GMT
A Bench of Supreme Court, consisting of Justices Sanjiv Khanna and Bela M. Trivedi, remanded a matter back to Jharkhand High Court for a fresh decision on Tata Steel's writ petition against the denial of input tax credit to its Naomundi unit. The court held that the High Court was not justified in ruling that Tata Steel had no locus standi to file a writ petition challenging the denial...
A Bench of Supreme Court, consisting of Justices Sanjiv Khanna and Bela M. Trivedi, remanded a matter back to Jharkhand High Court for a fresh decision on Tata Steel's writ petition against the denial of input tax credit to its Naomundi unit.
The court held that the High Court was not justified in ruling that Tata Steel had no locus standi to file a writ petition challenging the denial of input tax credit to its unit in Naomundi in respect of the purchases made and utilised by it. Tata Steel being a registered company and thereby a juristic person, the court held that its writ petition could not have been dismissed as not maintainable, despite its units being treated as separate assessees under the Jharkhand Value Added Tax Act, 2005.
Additionally, the court held that the reasoning given by the High Court in interpreting the provisions of Clause (ix) to sub-section (8) of Section 18 of the Jharkhand Value Added Tax Act, 2005 was cryptic and it did not examine the relevant issues while interpreting the said provision of the Act.
The court observed that the High Court should have considered the aspect of the said provision been amended by the Jharkhand Value Added Tax (Amendment) Ordinance, 2011 with retrospective effect, in the light of the relevant financial years involved in the present case.
Allowing Tata Steel's appeal against the judgment of Jharkhand High Court, the court set aside the High Court's order interpreting Clause (ix) to sub-section (8) of Section 18 of the Jharkhand Value Added Tax Act, 2005 as it existed prior to the amendment and remanded the matter back to the High Court for a fresh decision. The court held that it has not expressed an opinion on the interpretation of the said clause or the validity of the notification giving the amendment a retrospective effect and that it was open to Tata Steel to challenge the same.
"For Tata Steel- Mr. Kavin Gulati, Sr. Adv with Ms. Nandini Gore, Sr. Partner, Ms. Natasha Sahrawat, Ms. Neha Khandelwal, Mr. Karanveer singh Anand from Karanjawala &. Co.
For state of Jharkhand : Mr. A Chowdhury, Sr. Adv., Mr. Kumar Anurag Singh, ASG, Mr. Anando Mukherjee, AOR, Mr. Shwetank Singh, Adv. and Mr. Aniruddha Sethi, Adv."
Case Title: Tata Steel Ltd Versus The State Of Jharkhand And Ors.
