2021 (3) TMI 1080 - HC - GST

Grant of transitional credit under Section 140(1) of the Central GST Act in electronic credit ledger or otherwise as claimed by the petitioner in GST TRAN-1 - HELD THAT - It is not in dispute that, to avail the benefit of unutilized input credits under the pre-GST regime, the writ applicant had filed TRAN-1 on 10.07.2010 electronically, however, it was not successfully uploaded due to some technical glitches, but at the same time, the form was saved on the portal. It is also an admitted fact that, during the internal audit dated 24.04.2019 undertaken by the jurisdictional tax officer, the writ applicant came to know that the transitional credit had not been reflected in the electronic credit ledger due to technical glitches in the GSTN system. In view of the Circular issued by the Government of India, Ministry of Finance, the writ applicant had ventilated the grievance to resolve the technical issue at the GST portal and accordingly, the respondents had advised to the writ applicant to approach jurisdictional tax officer with the evidence of technical glitches/errors. The respondents failed to resolve the issue as raised by the writ applicant in the present writ application, despite the fact that, the Form TRAN-1 was filed within time limit, but it was not successfully uploaded due to technical glitches/error on the portal - there are no fault on the part of the writ applicant while claiming the CENVAT credit. This writ application is disposed off directing the respondents to consider and act upon the representation dated 30.01.2019 made by the writ applicant and decide the claim of the writ applicant in accordance with law.

Summary

Issues:
Claim for transitional credit under Section 140(1) of the Central GST Act not reflected in electronic credit ledger due to technical glitches.

Analysis:
The writ applicant, a manufacturing firm, sought transitional credit of &8377; 8,35,435 under Section 140 of the CGST Act, which was not reflected in their electronic credit ledger due to technical issues. The firm submitted Form GST TRAN-1 within the stipulated time limit, but it was not successfully uploaded. Despite multiple reminders and representations, the respondents did not address the issue, leading the applicant to approach the Court for relief.

The respondent authorities contended that the applicant failed to file TRAN-1 successfully within the prescribed time, resulting in the non-reflection of the eligible credit in the electronic ledger. They referred to the due date extensions provided for filing TRAN-1 and stated that the applicant's failure to submit the form electronically led to the non-reflection of the credit.

The Court noted that the applicant had indeed filed TRAN-1 electronically on time, but it was not uploaded successfully due to technical glitches. During an internal audit, it was discovered that the transitional credit was not reflected in the ledger. The Court observed that the respondents had not taken any action to resolve the issue despite the applicant's efforts and representations. The Court found no fault on the part of the applicant in claiming the credit.

Consequently, the Court disposed of the writ application by directing the respondents to consider and act upon the applicant's representation and decide on the claim for transitional credit within four weeks. The Court clarified that it had not assessed the eligibility of the credit claim and allowed the applicant to approach the Court in case of any difficulty. The Registry was instructed to communicate the order to the respective counsels for further action.