Blog > Louis Dreyfus Company India Pvt Ltd Vs. Union of India
Louis Dreyfus Company India Pvt Ltd Vs. Union of India
Court: Gujarat High Court
Issue: Refund of unutilized tax credit due to tax rate differences
Louis Dreyfus Company, an oil refining business in Gujarat, had a situation where the tax on raw materials (inputs) was higher than the tax on the final products (outputs). Because of this, a lot of input tax credit (ITC) accumulated in their tax accounts.
They applied for a refund of this unused ITC, as allowed under the GST rules. But tax authorities denied it, saying a new rule (Notification 9/2022) made the claim invalid even though the company applied before this rule came into effect.
The Gujarat High Court ruled in favor of the company, saying the refund application was made on time under Section 54 of the GST Act, and the new rule cannot be applied backward. The court ordered the tax department to process the refund.
This ruling by the Gujarat High Court has honored that the tax refund claims filed before a rule change must be followed according to the rule at the time of filing. This ruling has let the company uphold its rights to claim their legitimate refunds.