Sikkim High Court
Sikkim High Court Allows Refund of Unutilized Input Tax Credit (ITC) Upon Closure of Business
The Sikkim High Court ruled that a registered assessee is entitled to claim a refund of unutilized Input Tax Credit (ITC) upon closure of business under Section 54(1) of the CGST Act.
The Court emphasized that the right to claim ITC is a substantive right and cannot be denied merely because there is no specific provision for a refund on business closure.
The case involved a taxpayer whose refund claim was denied despite surrendering registration.
The Court directed the tax department to process the refund claim, affirming that denial would amount to unjust enrichment by the state.
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Lottery Distributors Not Liable to Pay Service Tax to Centre: Supreme Court
- Case Name: UOI & Ors. v. Future Gaming Solutions P.L.T.D and Anr.
The Supreme Court upheld the Sikkim High Court's ruling, stating that lottery distributors are not liable for service tax.
The Court ruled that the sale of lottery tickets by distributors does not qualify as a taxable service, as there is no agency relationship between the distributors and the State.
The Court affirmed that lotteries fall under "betting and gambling," which is exclusively within the State's authority to tax under Entry 62 of the State List.
The ruling follows a previous 2024 verdict in K.Arumugham V UOI, which also determined that selling lottery tickets is a revenue activity, not a service.
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