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17. It is stated that the petitioner has challenged a policy decision taken by the Parliament which is not subject to judicial scrutiny. It is stated that the challenge is completely misconceived and untenable. It is stated that in the Value Added Tax, there is a restriction on availing of such credit. The same cannot be provided on grounds of hardship or equity. The impugned provisions clearly restrict the CENVAT credit for the stock lying in the warehouse, as on 30-6-2017, only to the extent where the invoices or other prescribed documents issued are not earlier than twelve months preceding the appointed date, namely, 1-7-2017. Thus, a reasonable period of twelve months has been provided for availing of credit for such invoices or other prescribed documents. The writ petition is full of erroneous submissions and grounds. The decision taken is a conscious policy decision, that is to restrict the transition of suresh 20-21-WPGOJ-3142.2017.doc credit based on invoices/prescribed documents which are not more than a year old. This has been done to ensure a safeguard against potential misuse of availment of credit during the transition period by placing a restriction on availing credit based on documents which are not very old. There is no question of equity. There are similar restrictions and in place for manufacturers/service providers under the Fifth proviso to sub- rule (7) of Rule 4 of the erstwhile CENVAT Credit Rules, 2004. It is submitted that the power to restrict the flow of credit exists under Section 16(1) of the CGST Act. The Legislative intent is to grant input tax credit partially. The input tax credit provisions do not provide that all the taxes paid on all inputs should be available as credit. Some credits have been denied in the Act itself and to allow flexibility. The restrictions can be placed on availability of credit, as credit can be availed only as permitted by law. It is stated that the petitioner has erred in stating that the restriction/prohibition on taking of credit of CENVAT by a first stage dealer on the goods lying in stock where the invoice/prescribed documents are issued not later than twelve suresh 20-21-WPGOJ-3142.2017.doc months preceding the appointed date, is unreasonable and arbitrary. It is contended that a reasonable period of twelve months has been provided for availing of credit for such invoices or other prescribed documents. Further, input tax credit provisions do not provide that all taxes paid on all inputs should be availed as credit. Hence, the argument that there is a discrimination or there is unreasonableness, cannot be accepted. Thus, this whole affidavit proceeds on the footing that there is absolutely no substance in this challenge.

32. Mr. Raghuraman sought to rejoin to these submissions of the learned Additional Solicitor General by suresh 20-21-WPGOJ-3142.2017.doc urging that the input tax credit under the GST is an integral part of the GST law. It cannot be termed as a concession by the Government. Further, the attempt is to harmonise the indirect tax structure across the country. In the Constitution 122 nd Amendment Bill, 2014, the Objects and Reasons clearly set out that it is intended to remove the cascading effect of taxes and to bring out a nation wide taxation system. Therefore, there is a clear intention to have input tax credit as a nationwide objective at the Constitutional level. Hence, all the decisions prior to the CGST would not be applicable to the extent they term this as a concession. In this regard, he would read out certain paragraphs from the Statement of Objects and Reasons and heavily rely upon the principle that assuming, but without admitting, that input tax credit was in the nature of concession granted by the Government, but such concession has already been availed of by the petitioners on all the goods held in stock as on 30-6-2017. The concession of input tax credit has been availed and the same has crystallised as a vested right in view of Section 174, sub- section (2) Clause (c) of the CGST Act, 2017. Such vested right suresh 20-21-WPGOJ-3142.2017.doc cannot be taken away by retrospective/retroactive amendment. In that regard, our attention has been invited to the Judgment of the Hon'ble Supreme Court in the case of Jayam & Company v. Assistant Commissioner & Another, reported in (2016) 15 SCC 125.

42. So much therefore for the argument that input tax credit in the new regime is unconditional or without any restriction. Thus the conditional input tax credit, as can be availed of and strictly within the four corners of the statute, suresh 20-21-WPGOJ-3142.2017.doc particularly the substantive provisions, is not questioned nor the validity and legality of these provisions put in issue. Pertinently, by Section 17 apportionment of credit and blocked credits is dealt with and by Section 18, the availability of credit in special circumstances is provided. There as well as sub-section (1) of Section 18 says that it is subject to such conditions and restrictions as may be prescribed. By sub-section (2) of Section 18, it is evident that a registered person shall not be entitled to take input tax credit under sub-section (1) in respect of any supply of goods or services or both to him after the expiry of one year from the date of issue of tax invoice relating to such supply. By Section 19, taking input tax credit in respect of inputs and capital goods sent for job work is dealt with and by Section 20, the manner of distribution of credit by Input Service Distributor is provided for. The manner of recovery of credit distributed in excess is set out in Section 21. Chapter VI of the legislation is titled as Registration and persons liable for registration, persons not liable for registration, compulsory registration in certain cases, procedure for registration, deemed registration, special suresh 20-21-WPGOJ-3142.2017.doc provisions relating to casual taxable person and non-resident taxable person, amendment and cancellation of registration ending up to its revocation. These matters are covered by this Chapter, which contains Sections 22 to 30.

62. Reliance is then placed on another decision in the case of Jayam & Company (supra). Once again we must see what was dealt with in Jayam & Company. The argument before the Hon'ble Supreme Court in Jayam & Company was whether sub-section (20) of Section 19 of the Tamil Nadu Value Added Tax Act, 2006 could be given retrospective effect. The appellants were dealers and registered as such under the provisions of the above VAT Act. They argued that they had dealt in electronic home appliances. They purchased them from local registered dealers on payment of VAT under the VAT invoice issued by the vendors. Thereafter, there was a resale to consumers under the VAT invoice charging appropriate VAT on their selling price. On resale, VAT is paid by the dealer. The dealer is entitled to avail input VAT credit and he is entitled to credit on VAT which was suresh 20-21-WPGOJ-3142.2017.doc paid to the vendors on purchase of TV sets from the vendors. What had happened was, after the original tax invoice and availing the input tax credit, the vendor gave a discount and purchase credit note was issued for a lesser price. The dealer took into account the price which it had paid to the vendor after adjusting the discount that was subsequently given to the dealer to arrive at net cost and adding VAT which was limited to the vendors by the dealers. The goods were resold at a lesser price. After the introduction of sub-section (20) in Section 19 and once again, which has a non-obstante clause, the obligation was to reverse the input tax credit. In other words, if the registered dealer sold goods at a price lesser than the price of the goods purchased by him, he had to reverse the amount of input tax credit over and above the output tax of those goods. It was such an issue which was considered and in considering that the definitions and substantive provisions of the Tamil Nadu Value Added Tax Act, 2006 were referred. The Supreme Court noted that input tax credit is a form of concession provided by the Legislature. It is not permissible to all kinds of sales and certain suresh 20-21-WPGOJ-3142.2017.doc specified sales are specifically excluded. The concession of input tax credit is available on certain conditions mentioned in this section, namely, Section 19 and one of the most important condition was that, in order to enable the dealer to claim that credit it has to produce the original tax invoice, complete in all respect, evidencing the amount of input tax. It is in these circumstances that the Hon'ble Supreme Court held that the challenge to the constitutional validity had to fail. It clearly held that when there was a concession given by the statute, the Legislature has to make provision stating the form and manner in which the concession is to be allowed and the sub-section (20) seeks to achieve that. There was no right, inherent or otherwise, vested with dealers to claim the benefit of input tax credit but for Section 19 of the VAT Act. We, therefore, do not see how de hors this position a reliance can be placed only on some paras of this Judgment. We cannot ignore what was essentially decided. This is not a matter of retrospective operation of a fiscal statute, as was projected before us in the passing. This is a clear case as operating within the ambit of suresh 20-21-WPGOJ-3142.2017.doc Jayam & Company itself. As is before us, a concession is being provided by the Legislature which but for the provision granting such concession could have not been availed. The availment of CENVAT credit or input tax credit is clearly termed as a concession. With the conditions imposed, the concession could have been availed of. In the absence of a substantive provision granting such concession, there would have been no concession at all. Thus, one cannot pick and choose a condition for challenge by alleging that the availment is undisputedly conditional but one of the conditions, though having nexus with the availment, is unconstitutional or arbitrary and excessive. The nature of that condition, its placement consistent with the scheme is then conveniently ignored. We cannot allow this argument to be built on the basis of reliance on para 18 of the Judgment in Jayam (supra)