2020 (11) TMI 332 - HC - GST

Transitional credit under Rule 117 of CGST Rules and Rule 117 of the U.P. GST Rules - Time limitation for taking credit - power of Commissioner to extend the period of 90 days - HELD THAT - On perusal of the order dated 22.1.2020, it is clear that the rejection of the application is based upon the understanding that the GST TRAN-1 could not be filed on account of technical glitch and thus following the circular no. 39/13/2018-GST dated 3.4.2018, the request was rejected. - Prima facie, the said order does not even take into account the arguments of the petitioners for revision of the GST TRAN-1 FORM. Thus, we set aside the order dated 22.1.2020 with a direction to the respondent no. 3 to hear and decide the application for revision of GST TRAN-1 filed on 24.9.2019. Petition disposed off.

Summary

Issues:
Claim for input tax credit under CGST Rules and U.P. GST Rules, extension of time for filing FORM GST TRAN-1, omission of amounts in GST TRAN-1, application for refund versus revision under Rule 120-A of CGST Rules, rejection of refund application, reliance on previous judgment, rejection based on circular, consideration of revision request, remand for fresh consideration, setting aside the order, direction for reconsideration by respondent no. 3, decision on delay in filing revision application, application of Section 14 of the Limitation Act.

Analysis:
The petitioner, a Company engaged in manufacturing P.U. foam sheets and mattresses, claimed entitlement to input tax credit under CGST Rules and U.P. GST Rules. The petitioner argued that the transitional credit could be claimed within 90 days by submitting FORM GST TRAN-1, with a provision for the Commissioner to extend this period. Despite facing technical glitches, the petitioner filed the GST TRAN-1 late, omitting significant amounts totaling ?12,69,781 for specified months. The petitioner sought to rectify this omission through Rule 120-A of CGST Rules, allowing revision of declarations.

The petitioner mistakenly applied for a refund of the omitted amount instead of amending the declaration under Rule 120-A. This refund application was rejected, leading the petitioner to subsequently apply for revision of FORM GST TRAN-1. Citing a previous judgment, the petitioner argued that the delay should be condoned, emphasizing the distinction between filing and revising the GST TRAN-1. The respondents contended that a remand would allow fresh consideration by respondent no. 3.

Upon review, the Court found the rejection of the application to be based on the assumption that the GST TRAN-1 was not filed due to technical glitches, in line with a circular dated 3.4.2018. However, the Court noted that the rejection did not address the petitioner's arguments for revising the GST TRAN-1. Consequently, the Court set aside the order dated 22.1.2020 and directed respondent no. 3 to reconsider the application for revision filed on 24.9.2019. The Commissioner was instructed to decide on the delay in filing the revision application within four weeks, considering the provisions of Section 14 of the Limitation Act.

In conclusion, the writ petition was disposed of in accordance with the Court's directions, emphasizing a fair and thorough review of the petitioner's request for revision of the GST TRAN-1.