Advance Engineering Farms and Equipments v. State of Assam
In favour of the assessee
The ruling in brief
Advance Engineering Farms and Equipments challenged input tax credit denial before the Gauhati High Court, decided 16 July 2026. The assessee paid GST to registered sellers and held valid tax invoices, yet credit was denied because sellers failed to file returns or deposit tax. Justice Devashis Baruah held denial unlawful under section 16 read with section 39 and Rules 36 and 37A. Remedy for supplier default targets the supplier, not a bona fide purchaser without collusion. Rectification demand treating availed credit as excess was set aside. Decision aligns with purchaser-protection trends in supplier-default litigation. Outcome favoured the assessee. This editorial summary is intended for CAs and is not legal advice. Readers should consult the full judgment and current notifications before advising clients on compliance steps.
For information only — not legal advice. Read the full judgment and applicable law before relying on this summary.
Provisions considered
- CGST S.16 — Eligibility and conditions for taking input tax credit.
- CGST S.39 — Furnishing of returns by registered persons.
- CGST Rules R.36 — Rule 36 of the Central Goods and Services Tax Rules, 2017.
- CGST Rules R.37A — Rule 37A of the Central Goods and Services Tax Rules, 2017.
Source documents
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