India: Summaries of recent court decisions
Refund of unutilized GST input tax credit due to business closure allowed; consideration for grant of right of first refusal is capital receipt
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June 12, 2025
The KPMG member firm in India prepared reports on the following recent court decisions:
- The Sikkim High Court held that the taxpayer was allowed a refund of unutilized goods and services tax (GST) input tax credit (ITC) due to a business closure. Although the GST law does not explicitly address refunds of ITC under such situations, the court allowed the refund claim under Section 49(6) of the CGST Act, 2017. Read the June 2025 report
- The Delhi Bench of the Income Tax Appellate Tribunal held that consideration received by the taxpayer for granting its joint venture (JV) partner a right of first refusal (ROFR) to purchase its shares in the JV constitutes a capital receipt, as it represents advance received by the taxpayer against a future transfer of shares to the JV partner. Read the June 2025 report