If Authorities Acknowledge the Error and Accept Repayment Of Erroneous Refund, It is Logical to Restore The ITC in the Electronic Tax Ledger: Gujarat High Court

Case: I-Tech Plast India Pvt. Ltd vs State Of Gujarat
Coram: Justice JB Pardiwala and Justice Nisha Thakore
Case No.: C/SCA/3653/2021
Court Observation:

The Gujarat High Court has directed the revenue to re-credit/restore the Input Tax Credit (ITC) to the tune of INR 1,39,49,810 in the electronic tax ledger or the writ petitioner.
It was further stated that the bone of contention was not the refund as contemplated under Rule 96(10) but rather the restoration of the ITC which was erroneously refunded and subsequently recovered. If the authorities had accepted that there was an error and had accepted repayment of the erroneous refund, it was only logical that the credit of the ITC was restored. It was emphasized that there was no question of refund but rather the restoration of the ITC in the electronic credit ledger since the amount was repaid along with interest.

If Authorities Acknowledge the Error and Accept Repayment Of Erroneous Refund, It is Logical to Restore The ITC in the Electronic Tax Ledger: Gujarat High Court