The case involves the denial of Input Tax Credit (ITC) to purchasing dealers who were unable to prove the genuineness of their transactions.

The Assessing Officer and the first Appellate Authority denied ITC on the grounds of doubt about the authenticity of the purchases, while the second Appellate Authority and the High Court allowed ITC as the purchasing dealers produced invoices and made payments through cheques.

However, the burden of proof for claiming ITC lies on the purchasing dealer, and the mere production of invoices and payment proofs is insufficient. The purchasing dealer must establish the physical movement of goods, prove the genuineness of transactions, and provide details such as the name and address of the selling dealer, vehicle details, freight charges, acknowledgment of delivery, and payment particulars.

The burden of proving the correctness of ITC cannot be shifted to the revenue.

The State of Karnataka …Appellant
M/s Ecom Gill Coffee Trading Private Limited
…Respondent decided by the Supreme Court of India on 13.03.23


Sanjiv Narang Adv. is an Advocate on Record in the Supreme Court of India. His qualifications include an LLB from University of Delhi and a Masters degree in Personnel Management from Panjab University,Chandigarh.In his more than 3 decades of experience, he has practiced law at the District, High Court and Supreme Court levels.He also has more than a decade of experience in the field of Management. He is the author of two books namely Laws for Women in India and Innovation, Why What and How.