Accumulated ITC Refund Allowed As Assessee Not Intermediary

Case Details: Bluefish Pharmaceuticals (P.) Ltd. vs. Union of India [2026] 182 taxmann.com 92 (Karnataka)

Judiciary and Counsel Details

S.R.Krishna Kumar, J.
Bharat Raichandani, Raaghul Piraanesh & Chandrakiran. K, Advs. for the Petitioner.
Nishan Unni.P, CGC & Smt. Jyothi. M. Maradi, HCGP for the Respondent.

Facts of the Case

The petitioner was engaged in providing research and development (R&D) services and challenged the rejection of its refund claim. During the relevant period, the petitioner issued export invoices for the services provided to its parent company abroad under a Letter of Undertaking (LUT) with the endorsement ‘Export of Services without payment of IGST’ and claimed a refund of accumulated and unutilized input tax credit (ITC) available in its electronic credit ledger. The petitioner contended that it was not an ‘intermediary’ and, therefore, was entitled to claim the refund. The matter was accordingly placed before the High Court.

High Court Held

The High Court held that the petitioner was not an ‘intermediary’ within the meaning of the CGST provisions and was directly providing R&D services to its parent company abroad. The Court observed that the claim for refund of accumulated ITC on export of services without payment of IGST was valid. It was noted that the impugned orders of the jurisdictional officer and the appellate authority were contrary to the statutory entitlement under Section 54 of the CGST Act and the Karnataka GST Act. Therefore, the Court quashed the rejection orders.