Facts of the Case:

In this case, the applicant imported fully automatic mould cleaning machines from China under Bill of Entry dated 10.01.2023. While clearing the goods, the applicant paid IGST at 5%, claiming exemption under Sl. No. 257 of Schedule I of Notification No. 01/2017-IGST (Rate), applicable to assistive devices and rehabilitation aids for persons with disabilities.

Subsequently, on 05.04.2024, the Additional Commissioner of Customs, Kolkata, issued a pre-consultation letter under Section 28(1), stating that the applicant wrongly claimed the concessional rate since the imported machinery was neither assistive device nor covered under List 3 of the notification. The goods were reclassified under CTH 8437 attracting 18% IGST under Sl. No. 329A of Schedule III. A differential IGST demand of ₹27,14,559 was computed along with interest.

The applicant chose to accept the departmental view and paid the differential IGST and interest on 10.05.2024 through a challan. The Customs department thereafter issued a closure letter dated 13.09.2024 confirming that no further action was required. Since this payment was made much after the original Bill of Entry date, the applicant sought an Advance Ruling on whether the IGST so paid could be availed as input tax credit (ITC) in light of Section 16(4) of the CGST Act governing time limits for availing ITC.

The applicant argued that the differential IGST paid is part of import tax and ITC should be available, payment documents such as challan or pre-consultation letter are “similar documents” under Rule 36(1)(d), the time limit under Section 16(4) should apply based on the year of payment (FY 2024–25), customs acceptance of the challan substantiates its validity for GST purposes.

Issue:

Whether ITC of ₹27,14,559 of differential IGST paid through a pre-consultation letter under Section 28(1) of the Customs Act can be availed by treating such payment document as a valid document under Section 16(2) read with Rule 36(1)(d) of the CGST Rules, and whether such credit is barred by the time limit prescribed in Section 16(4) of the CGST Act, 2017

Held that:

The Authority first examined whether the applicant possessed a valid ITC document, as this constitutes a primary condition under Section 16(2) and Rule 36(1). It held that neither the pre-consultation letter issued under Section 28(1) of the Customs Act nor the payment challan for differential duty qualifies as a prescribed document for availing ITC. Rule 36(1)(d) permits ITC only on the basis of a Bill of Entry or any similar document prescribed under the Customs Act for assessment of IGST on imports.

Applying the principle of ejusdem generis, the AAR clarified that “similar documents” must be restricted to documents akin to Bills of Entry—such as courier Bills of Entry or declarations associated with import assessment—and cannot include pre-consultation letters or duty-payment challans.

Since the core condition of possessing a prescribed document was not satisfied, the AAR held that the applicant cannot avail ITC on the differential IGST paid through a pre-consultation mechanism. As ITC itself was held inadmissible, the Authority declined to examine the corollary question regarding Section 16(4) time limitation, considering it unnecessary. The application was thus rejected, and the Authority concluded that no credit was allowable in law.

Case Name: Hansaben Jayantibhai Patel [Trade Name:- Trishul Die and Engineering Works] dated 24.11.2025

To read the complete judgement 2025 Taxo.online 3194