Section 16(2)(c), CGST Act constitutionally valid, but cannot be invoked mechanically against purchasing dealers: P&H High Court lays down guidelines
The High Court held that the condition of actual payment of tax to the Government was the very foundation of ITC and was not unconstitutional, but that the provision had to be read and applied in harmony with the statutory scheme and could not be invoked routinely against a purchasing dealer who had paid tax to the supplier.