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2025 (4) TMI 340 - HC - GSTValidity of direction to open the GST portal enabling the writ petitioner to submit the revised FORM GST TRAN-1 in view of Rule 120A of the Central Goods and Services Tax Rules 2017 - HELD THAT - A registered assessee who was eligible for a credit of tax paid under pre-GST regime was entitled to claim credit of input taxes as per the provisions contained in Section 140 of the Central GST Act. GST TRAN-1 is the transition form to be filed for taxpayers who were registered under the pre-GST regime to avail the accumulated input tax remaining in their account on 30-6-2017 i.e. the day preceding the appointed day. The said form is to be filed by every person having input tax credit on the closing stock and who have migrated to GST regime. It is the case of the writ petitioner / respondent No. 1 herein that the Tax Consultant engaged by it while opening and making entries in TRAN-1 portal qua the writ petitioner instead of entering eligible CENVAT credit amount mistakenly entered NIL in the Form TRAN-1 and pressed the submit button upon which immediately the Form got freezed and there was no option to edit the uploaded form which is also supported by the affidavit of Tax Consultant Mr. Rishikesh Sharma filed along with the writ petition vide Annexure P-6 against which the writ petitioner made representation to the Principal Commissioner Central GST Central Excise but to no avail. Whether on account of such technical error / advertent error can the registered assessee be denied the transitional credit? - HELD THAT - The Supreme Court in Filco Trade Centre Private Limited 2022 (7) TMI 1232 - SC ORDER considering the technical glitches suffered by the registered assessees granted two months time from 1-9-2022 to 31-10-2022 to file transitional credit through TRAN-1 and TRAN-2 and extended the same up to 30-11-2022 by order dated 2-9-2022. The Supreme Court in the matter of Collector of Central Excise Pune and others v. Dai Ichi Karkaria Ltd. and Others 1999 (8) TMI 920 - SUPREME COURT held that credit obtained by the manufacturer for the excise duty paid on raw material to be used by him in the production of an excisable product is indefeasible. Coming to the facts of the present case although the writ petitioner committed blunder in filing Form TRAN-1 but as per the writ petitioner huge sum of money was credited in his account and same was found lying unutilized in the last return filed by it for the month of June 2017. As held by the Supreme Court in Unichem Laboratories Ltd. 2002 (9) TMI 110 - SUPREME COURT it is not the duty of the Revenue to deprive an assessee of the benefit available to him in law and for which he was otherwise eligible and is legitimately available to him and the authorities functioning under the Act are required to act reasonably and fairly. The circular issued under Section 168A of the Central GST Act would not come in way of the assessee to revise its Form TRAN-1 and in that view of the matter the learned Single Judge is absolutely justified in directing respondents No. 1 2 5 therein to facilitate revising of Form GST TRAN-1 to the writ petitioner. We do not find any good ground to entertain the instant writ appeal. Conclusion - The right to transitional credit are indefeasible and cannot be curtailed by procedural technicalities or administrative instructions. The appeal dismissed upholding the Single Judge s order to allow the writ petitioner to revise FORM GST TRAN-1.
ISSUES PRESENTED and CONSIDERED
The core legal question considered was whether the learned Single Judge was justified in directing the relevant respondents to reopen the GST portal, enabling the writ petitioner to submit a revised FORM GST TRAN-1 in accordance with Rule 120A of the Central Goods and Services Tax Rules, 2017. ISSUE-WISE DETAILED ANALYSIS Relevant Legal Framework and Precedents The case revolves around the provisions of the Central Goods and Services Tax Act, 2017, and the Central Goods and Services Tax Rules, 2017, particularly Rule 120A, which allows for the revision of FORM GST TRAN-1. The Supreme Court's decision in Filco Trade Centre Private Limited was pivotal, as it directed the reopening of the GST portal for a specific period to address technical glitches faced by taxpayers in filing transitional credit forms. Court's Interpretation and Reasoning The Court emphasized that the authorities under the Act must act reasonably and fairly, as established in Unichem Laboratories Ltd. v. Collector of Central Excise. The Court found that the writ petitioner was unfairly denied the opportunity to revise FORM GST TRAN-1 due to a technical error made by the Tax Consultant. The Court noted that the circular dated 9-9-2022, which restricted further revisions, could not override the statutory provision allowing revisions under Rule 120A. Key Evidence and Findings The writ petitioner had mistakenly entered NIL in the TRAN-1 form due to an error by the Tax Consultant, which was supported by an affidavit. Despite representations to the authorities, the petitioner was not allowed to rectify the error before the deadline set by the Supreme Court's order. Application of Law to Facts The Court applied the principle that the right to claim transitional credit is a constitutional right under Article 300A of the Constitution, as recognized in Siddharth Enterprises v. Nodal Officer. It held that the petitioner's right to transitional credit could not be denied due to a procedural error, especially when the Supreme Court had provided a window for corrections. Treatment of Competing Arguments The appellants argued that the writ petitioner was negligent in submitting the form and that allowing revisions would lead to an endless process. However, the Court found that the petitioner's right to transitional credit, as per the statutory provisions and Supreme Court directives, outweighed the procedural lapse. The Court rejected the appellants' reliance on the circular, emphasizing the statutory right to revise under Rule 120A. Conclusions The Court concluded that the learned Single Judge correctly directed the reopening of the GST portal for the petitioner to revise the TRAN-1 form, ensuring the petitioner could claim the transitional credit to which it was entitled. SIGNIFICANT HOLDINGS The Court reaffirmed the principle that authorities must act fairly and reasonably, ensuring taxpayers are not deprived of benefits due to procedural errors. It held that the right to transitional credit is constitutional and cannot be overridden by administrative circulars. Core Principles Established The judgment reinforced the principle that statutory rights, such as the right to transitional credit, are indefeasible and cannot be curtailed by procedural technicalities or administrative instructions. It emphasized that the statutory provision allowing for revisions (Rule 120A) takes precedence over conflicting administrative circulars. Final Determinations on Each Issue The Court dismissed the writ appeal, upholding the Single Judge's order to allow the writ petitioner to revise FORM GST TRAN-1. It directed the relevant authorities to facilitate the revision, ensuring the petitioner could claim the transitional credit.
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