2020 (7) TMI 509 - HC - GST

Filing of Form GST TRAN-1 - transitional credit - time limitation - vires of 117 of the CGST Rules, 2017 - HELD THAT - The writ petition is disposed off with a direction to the respondent No.2, 3 and 4, as the case may be, to take a decision on the representation (Annexure P/7) filed by the petitioner within fifteen days by passing a speaking order after affording an opportunity of hearing to the petitioner or his representative through video conferencing, in accordance with law.

Summary

Issues:
1. Relief sought by the petitioner under Article 226/227 of the Constitution of India for filing Trans 1 before the due date.
2. Claim for transitional credit under Section 140(3) of CGST Act, 2017.
3. Nature of due date under Rule 117 of CGST Rules, 2017.
4. Judicial precedents cited by the petitioner from Punjab and Haryana High Court, Gujarat High Court, and Delhi High Court.

Analysis:
1. The petitioner sought relief under Article 226/227 of the Constitution to file Trans 1 before the due date of 31.03.2020. The petitioner, a registered work contractor, claimed transitional credit for VAT filed in Form 10 for April to June 2017. The Central Board of Indirect Taxes extended the deadline to file Trans 1 to 31.03.2020. The petitioner argued that Section 140 of CGST Act, 2017, and Rule 117 of the Rules protect the substantive right to claim transitional credit despite procedural lapses.

2. The petitioner relied on judgments from Punjab and Haryana High Court, Gujarat High Court, and Delhi High Court to support their claim. These judgments emphasized allowing legitimate claims of CENVAT/ITC despite delays in filing Trans 1. The Supreme Court affirmed the judgment of Punjab and Haryana High Court, reinforcing the importance of not denying legitimate claims due to procedural delays.

3. The due date under Rule 117 of CGST Rules, 2017, was contested by the petitioner as being procedural and directory, not mandatory. The petitioner argued that technical difficulties prevented timely filing of Trans 1, and the respondents should allow the filing to claim transitional credit. The respondents did not object to the petitioner's representation and agreed to decide on it in accordance with the law.

4. The High Court, without expressing an opinion on the merits, directed the respondents to decide on the petitioner's representation within fifteen days. The decision was to be made by passing a speaking order after providing an opportunity for the petitioner or their representative to be heard through video conferencing. The writ petition was disposed of accordingly, emphasizing the importance of addressing the petitioner's claim in a timely and lawful manner.