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2022 (7) TMI 647 - HC - GSTSeeking issuance of a writ of mandamus to command the authorities - transitional input tax credit - credit denied on technical ground for not putting the digital signature in the uploaded GSTR TRAN 1 form - seeking permission for rectification of the GST TRAN 1 either through portal or manually for the purpose of claiming transitional credit under Section 140 read with Rule 117 of the Central Goods and Services Tax Act, 2017 - HELD THAT - It is well settled that entitlement of the petitioner to the input tax credit is a vested right and the same cannot be denied on account of procedural problem. This Court accordingly holds that the issue involved in the instant writ petition is squarely covered by the decision in the case of M/s. Das Auto Centre 2021 (12) TMI 835 - CALCUTTA HIGH COURT where it was held that It is clearly clearly brought out the difficulties faced by the assesses and also as to how the assesses having substantially complied with the requirement under law and having been entitled to credit on account of transition to the GST regime which is beyond the purview of the assessee and the assessee cannot be put to prejudice on account of technicalities. Thus, keeping the underlying principle in mind if the matter is examined then we are inclined to lean in favour of the writ petitioners and affirm the directions issued by the learned Single Judge. This Court is of the considered view that liberty is to be granted to the petitioner /assessee to file individual tax credit in GSTR 3B form. If such form is filed in terms of this order, the authorities shall act on the GSTR-3B form filed pursuant to this order - Application allowed.
Issues Involved:
- Rectification of GST TRAN 1 for claiming transitional credit under CGST Act - Denial of input tax credit on technical grounds - Entitlement to input tax credit subject to verification - Application of doctrine of substantial compliance in claiming input tax credit Analysis: 1. Rectification of GST TRAN 1 for claiming transitional credit under CGST Act: The petitioner sought a writ of mandamus to command the authorities to allow rectification of the GST TRAN 1 for claiming transitional credit under Section 140 read with Rule 117 of the CGST Act. The petitioner, engaged in selling two and three-wheelers and spare parts, claimed excess input tax credit but faced issues due to technical glitches and procedural complexities. Despite correctly uploading the GSTR 1 form, the petitioner could not put the digital signature, leading to the denial of utilizing the input tax credit. The petitioner approached the Court after submitting a representation that remained unaddressed by the concerned authority. 2. Denial of input tax credit on technical grounds: The principal grievance of the petitioner was the denial of entitlement to input tax credit on technical grounds, specifically for not affixing the digital signature in the uploaded GSTR TRAN 1 form. The Court emphasized that the entitlement to input tax credit is a vested right and cannot be denied due to procedural issues. The Court referred to a previous judgment in a similar matter and highlighted the importance of addressing technical difficulties faced by taxpayers in transitioning to the GST regime. 3. Entitlement to input tax credit subject to verification: While acknowledging the petitioner's entitlement to carry forward tax credit under Section 140 of the CGST Act read with Rule 117 of the CGST Rules, the Court emphasized that the claim for input tax credit is subject to verification by the Assessing Officer. The Court underlined the need for authorities to verify the genuineness of the petitioner's claim before passing any orders. 4. Application of doctrine of substantial compliance in claiming input tax credit: The Court extensively discussed the application of the doctrine of substantial compliance in claiming input tax credit, citing various judgments from different High Courts and the Supreme Court. The Court highlighted the difficulties faced by taxpayers in complying with technical requirements and stressed the importance of not prejudicing taxpayers due to procedural issues. The Court granted liberty to the petitioner to file individual tax credit in GSTR-3B forms, directing the authorities to act on the forms filed pursuant to the order. In conclusion, the Court allowed the writ petition, granting the petitioner liberty to file individual tax credit in GSTR-3B forms, subject to verification by the concerned authority. The Court's decision was based on the application of the doctrine of substantial compliance and the need to address technical difficulties faced by taxpayers in transitioning to the GST regime.
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