2022 (5) TMI 694 - HC - GST

Rejection of application of the petitioner to revise the form TRAN-1 - petitioner cannot fill details in Table 4 of TRAN-2 - Central Goods and Services Tax Act, 2017 - HELD THAT - The fact that petitioner had sought to correct the mistake in the details supplied in TRAN-1 immediately on becoming aware of the error, is evident from Ext.P3 dated 16-03-2018. The statutory limitation prescribed for correcting errors that occurred during the initial stages of transition ought not to be used as an iron handle to deny the legitimate claims of taxpayers, especially for claims relating to transitional input tax credit. When it is apparent from the circumstances, that, the mistake was a bonafide error and arose on account of an error in perception and comprehension of minute details of the new formats to be submitted, denying the relief of correcting the error can only be termed as arbitrary and unreasonable. In such instances, this Court cannot shy away from its constitutional obligation of enforcing equal protection of all laws within the territory of India, contemplated under Article 14 of the Constitution of India. Admittedly the portal opened only on 15th March, 2018, for filing the TRAN-2 returns and petitioner could realise the inadvertent error only after that. Immediately thereafter, a complaint was made to the GST council. Thus, this Court finds that the mistake in filling up TRAN-1 form is a genuine, and, in the circumstances, the said error should not prevent the petitioner from claiming or being entitled to claim, what is otherwise legally due to it. The respondents are directed to facilitate revising of form GST TRAN-1 submitted by the petitioner on 01-09-2017 and to file form GST TRAN-2 by making necessary arrangements on the web portal - petition allowed.

Summary

Issues:
Challenge to rejection of application to revise form TRAN-1 under Central Goods and Services Tax Act, 2017.

Detailed Analysis:

1. Background and Error in Form Submission:
The petitioner, a registered dealer under the Kerala Value Added Tax Act, 2003 and Central Sales Tax Act, 1956, claimed unutilized input tax credit under the earlier tax regime. After the introduction of GST, the petitioner submitted form GST TRAN-1 but made an inadvertent mistake by filling Table 7(d) instead of Table 7(a), preventing the completion of form GST TRAN-2.

2. Representation and Rejection:
The petitioner sought redressal from the GST Council and filed representations after realizing the error. However, the representations were rejected, leading to the filing of a writ petition seeking correction of form GST TRAN-1 and credit of unutilized input tax.

3. Legal Provisions and Respondents' Arguments:
Respondents argued that corrections for inadvertent mistakes were not allowed after the specified time limit for filing TRAN-1. They highlighted Rule 117 of CGST Rules, 2017, and Rule 120A, emphasizing the limitations and the one-time revision provision.

4. Court's Observations and Precedents:
The Court acknowledged the challenges faced during the nascent period of GST implementation and cited precedents where courts provided relief to taxpayers in similar situations. It emphasized the need for fairness and equal protection under the law, as guaranteed by Article 14 of the Constitution of India.

5. Judgment and Relief Granted:
Considering the genuine mistake made by the petitioner and the legal entitlement to claim input tax credit, the Court set aside the rejection and directed the respondents to facilitate the revision of form GST TRAN-1 and filing of form GST TRAN-2. The Court allowed manual filing if necessary, within a specified timeframe of two months from the date of the judgment.

In conclusion, the Court's decision favored the petitioner's plea for correction of the inadvertent error in form submission, highlighting the need for fairness and adherence to legal entitlements in the context of GST implementation challenges.