Relief to Lloyd; Kerala HC Sets Aside Order Denying ITC without Considering Newly Inserted Provision U/S 16 (5) of CGST Act

The Kerala High Court ruled in favor of Lloyd, setting aside an order that denied Input Tax Credit (ITC) under section 16(5) of the CGST Act. The court found that the newly inserted provision allowing the denial of ITC on certain goods and services should have been considered. The decision emphasized that the provision’s retrospective application could not be applied without proper evaluation. It also stressed that tax authorities must consider changes in the law when making decisions on ITC claims. The ruling is a significant victory for taxpayers in ensuring that their claims for tax credits are evaluated fairly and in accordance with the law.