Facts of the Case:

In this case, the petitioner challenged an assessment order dated 28.04.2023 whereby the Input Tax Credit (ITC) availed on purchases made during FY 2018-19 from Eco-friendly Coco Products was disallowed. The Revenue alleged that the petitioner had failed to establish the genuineness of the transactions and actual movement of goods, as supporting documents such as lorry receipts and weighment slips were not produced. The petitioner contended that, at the time of the transactions, the supplier was a validly registered GST dealer and that its registration was cancelled only subsequently.

It was further submitted that the supplies were supported by valid tax invoices containing vehicle details, the supplier had filed GST returns disclosing the transactions, and the corresponding tax had been duly paid to the Government. According to the petitioner, the transportation of goods had been arranged by the supplier, and the denial of ITC merely for want of certain transport documents was unjustified.

Issue:

Whether Input Tax Credit can be denied solely on the ground that the recipient failed to produce lorry receipts and weighment slips, despite the supplier being a registered dealer at the time of supply, the transactions being supported by tax invoices containing vehicle details, and the supplier having reported the supplies in GST returns and paid the applicable tax.

Held That:

The High Court set aside the assessment order and remanded the matter for fresh consideration. The Court observed that the supplier was admittedly a registered person during the relevant period and that the invoices relied upon by the petitioner contained vehicle numbers indicating transportation of the goods. It further noted that the supplier had filed the requisite GST returns and discharged the tax liability on the impugned supplies.

In these circumstances, the adjudicating authority ought to have undertaken a deeper examination of the genuineness of the transactions instead of mechanically rejecting the ITC claim solely because lorry receipts and weighment slips were not produced. Holding that the assessment suffered from inadequate examination of the relevant evidence, the Court permitted the petitioner to produce additional documents relating to the supplies within fifteen days and directed the respondent to pass a fresh reasoned order after granting an opportunity of hearing within three months.

Case Name: Akal Trade Links v. Assistant Commissioner (ST) dated 05.06.2026

To read the complete judgement 2026 Taxo.online 1742