2023 (11) TMI 775 - HC - GST

Permission to transfer the business and the Input Tax Credit lying un-utilized in its Electronic Credit Ledger - HELD THAT - Essentially the case of the petitioner is that the show-cause notice is unwarranted inasmuch as but for the non-availability of Form ITC-02 under GST Portal, it was only possible for the petitioner to file the Form manually for transferring the Input Tax Credit to the transfaree and therefore the show-cause notice is misconceived. Having perused the show-cause notice dated 29.09.2023, the petitioner is directed to file a response to the show-cause notice within 2 weeks from the date of receipt of copy of this Court. As soon as the petitioner responds to the show-cause notice, the respondents are directed to consider the case of the petitioner in light of its own case which was decided by the Division Bench of Allahabad High Court in Writ Tax No. 859 of 2023 2023 (8) TMI 46 - ALLAHABAD HIGH COURT . Considering the identical issue where the Division Bench of the Allahabad High Court held the petitioner has been non suited on the ground that Form ITC-02 for transfer of input tax credit was not available on the GST Portal which was in nascent stage during the initial months after its implementation on 01.07.2017 and it was incumbent upon the petitioner to have raised a proper grievance on the GST portal help-desk and ought to have waited for the relevant Form to go live on the GST portal instead of making illegal adjustment by use of the Form GSTR-3B of the transferor and the transferee company and mere shortage of working capital cannot be an excuse to bypass the legal procedure laid down under the law. The respondents are directed to consider the case of the petitioner in light of the decision passed by the Allahabad High Court and pass an appropriate order in accordance with law especially considering the findings of the Allahabad High Court as to non-availability of the Form ITC-02 on online portal of GST - Petition is disposed of.

Summary

Issues:
The issues involved in the judgment are the challenge to a show-cause notice issued by the respondents regarding the transfer of unutilized Input Tax Credit under the Central Goods and Service Tax Act.

Details of the Judgment:

Issue 1: Challenge to Show-Cause Notice
The petitioner challenged a show-cause notice dated 29.09.2023 issued by the respondents regarding the transfer of unutilized Input Tax Credit. The petitioner contended that due to the non-availability of Form ITC-02 on the GST Portal, they manually filed the form for transferring the credit to the transferee. The petitioner relied on a similar order passed by the High Court of Allahabad in their favor, dealing with the same issue.

Issue 2: Consideration of Submissions
After hearing the arguments from both parties, the Court directed the petitioner to respond to the show-cause notice within two weeks. The Court also instructed the respondents to consider the petitioner's case in light of the Allahabad High Court's decision, which highlighted the non-availability of Form ITC-02 on the online portal of GST. The Court emphasized the importance of following legal procedures and providing a fair opportunity for the petitioner to be heard before making any decisions.

Separate Judgment by Allahabad High Court:
A separate judgment by the Allahabad High Court in a similar case emphasized the necessity for proper consideration of objections raised by the petitioner and providing an opportunity for a personal hearing. The Court set aside the previous order and instructed the authorities to pass a fresh order after considering the petitioner's objections and ensuring compliance with the law.

Conclusion:
The Court directed the respondents to reconsider the petitioner's case based on the Allahabad High Court's decision and to pass an appropriate order in accordance with the law. The petition was disposed of with the directive for direct service and cooperation from the petitioner in the proceedings.