2019 (12) TMI 164 - HC - GST

Grant of registration - migration of registration under Notification dated 6.8.2018 - transitional credit - While the application for migration had to indicate the provisional GSTIN that was earlier granted to the petitioner, the petitioner inadvertently showed the new GSTIN that had been allotted to him in July 2018. This led to the respondents (revenue) taking a stand that the migration to the GST to cover the period from July 2017 onwards could not be accepted. - the stand of the respondents is only that the application for migration was belated. HELD THAT - It is not in dispute in the instant case that the petitioner had availed of the extended time limit granted through the Notification dated 06.08.2018 to prefer an application for migration on 09.08.2018, well before the last date of 31.08.2018 prescribed by the respondents. No doubt, there was an inadvertent error occasioned by the petitioner while furnishing the GSTIN number. While he ought to have indicated the provisional GSTIN that he once held, he provided the GSTIN number that was subsequently obtained by him in July 2018. In matters where the assessee risks the loss of a substantive right that accrued to him, the revenue ought to relax the procedural requirements so as to ensure that substantive benefits accrued to assessees are not denied on account of mere technical lapses - In the instant case, since it is found that there is no dispute with regard to the identity of the assessee, who held a provisional GSTIN and later a regular GSTIN, and he was under the regulatory supervision of the GST department throughout the period, there cannot be any prejudice caused to the revenue by allowing the petitioner to migrate the accumulated credit in his account. Ext.P7 are quashed and the respondents are directed to treat the GSTIN granted to the petitioner in July 2018, as covering the period from July 2017 onwards, by making appropriate adjustments in the system - petition allowed.

Summary

Issues:
1. Migration to GST regime post-implementation of GST.
2. Rejection of application for migration due to erroneous GSTIN.
3. Dispute regarding the identity of the petitioner under different GSTINs.
4. Request for quashing communication and granting registration for transitional credit.

Analysis:
1. The petitioner, a club, sought permission to migrate to the GST regime after the implementation of GST, having previously held a service tax registration. Due to a delay in completing the registration process, the provisional GSTIN allotted to the petitioner was canceled, hindering the filing of GST returns from July 2017 onwards. The petitioner later obtained a regular GSTIN in July 2018. An application for migration was submitted in August 2018, mistakenly indicating the new GSTIN instead of the provisional one. The respondents rejected the migration application citing delay. The petitioner filed a writ petition to quash the rejection and obtain registration for transitional credit from July 2017 onwards.

2. Respondents justified the rejection of the application based on the erroneous GSTIN provided by the petitioner, causing delays in the migration process. Statements from respondents detailed the sequence of events leading to the rejection.

3. The court acknowledged the inadvertent error in furnishing the GSTIN but emphasized that the petitioner availed the extended time limit to submit the migration application before the deadline. Despite the error, the court found no dispute regarding the petitioner's identity under both GSTINs, ensuring no prejudice to the revenue by allowing migration of accumulated credit. The court held that procedural requirements should be relaxed to prevent denial of substantive benefits due to technical lapses. As there was no identity dispute and the petitioner was under regulatory supervision throughout, the court quashed the rejection, directing the respondents to consider the GSTIN issued in July 2018 as covering the period from July 2017 onwards, with necessary system adjustments to be made within a month.