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TMI Blog2021 (6) TMI 108X X X X Extracts X X X X X X X X Extracts X X X X ..... Mr. Digajmaan Mishra and Mr. Akshat Malpani, Advocates. Mr. Ashok K. Bhardwaj and Mr. Manish Kr. Hirani, Advocates. Mr. M. A. Ansari with Mr. Khursheed Ahmad, Advocates. Mr. Nishant Mittal, Advocate. Respondents Through: Mr. Ravi Prakash, CGSC for R-1 Mr. Anuj Aggarwal, ASC, GNCTD with Mr. Shikhar Sheel and Ms. Ayushi Bansal, Advocates for R-4,5&6., Ms. Sunieta Ojha, Advocate. Ms. Sonu Bhatnagar, Senior Standing Counsel with Ms. Venus Malhotra, Mr. Vaibhav Joshi Ms. Mallika Joshi Advocate for R-2 to R-5. Mr. Vivek Goyal, CGSC for UOI. Mr. Harpreet Singh, Sr. Standing Counsel with Ms. Suhani Mathur, Advocate for GST. Mr. Jitesh Vikram Srivastava with Mr. Prajesh Vikram Srivastava, Advocates for UOI. Mr. Ajay Digpaul, CGSC and Mr. Kamal R. Digpaul, Advocate for R-1/UOI. Mr. Sandeep Kumar with Mr. Kunal Sharma, Sr. Standing Counsel for Income Tax Department. Mr. Anil Soni, CGSC with Mr. Devesh Dubey, Advocate for R-1. Ms. Sonu Bhatnagar, Senior Standing Counsel with Ms. Venus Malhotra, Mr. Vaibhav Joshi Ms. Mallika Joshi Advocate for R-3 & 5. Mr. Virender Pratap Singh Charak, with Mr. Kapil Gaur, Mr. Vaishnav Kirti Singh, Mr. Shubham Ahuja and Mr. Sanjay Singh Chauhan, Advocates for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... after "TRAN-1 Form") by furnishing details of amount of CENVAT credit sought to be carried forward in the return, relating to the period ending with the day immediately preceding the appointed date, i.e., 1st July, 2017. The last extended date for filing the TRAN-1 Form, was prescribed as 27th December, 2017. 3. Unfortunately, the transitionary mechanism was not smooth and easy for numerous taxpayers. Several factors, including technical glitches and shortcomings in the online system, prevented or obstructed them from filing the TRAN-1 Form by the above deadline. Many taxpayers complained of poor/low internet bandwidth and cited various other technological hindrances while accessing the online portal closer to the deadline, that hindered their attempts. After the cut-off date, the filing was blocked on the online portal. 4. Taxpayers narrating their grievances petitioned this Court and several other High Courts in the country seeking directions to Respondent to reopen the portal. Concurrently, the Government took cognizance of the complaints and acknowledged the genuine problems faced by the taxpayers. Resultantly, a redressal mechanism to address the IT-related glitches was set ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and further considering that the transition happened rather rapidly, they should be given the benefit of the doubt. As on date, there are numerous decisions dealing with varied challenges faced by the taxpayers in meeting the deadline in filing the TRAN-1 Form. In all such situations, this Court has consistently directed the GST authorities to reopen the portal or to allow manual filing of the TRAN-1 Form.2 Some such judgments have been assailed by the Respondents before the Supreme Court, and from amongst them, a few have been rejected while others are pending.3 We are also aware that some High Courts have taken a view that is different from the one taken by this Court, but nonetheless, this Court has consistently upheld the right of taxpayers to claim transition of CENVAT credit.4 8. We must stress that shortcomings faced in the online system during the trial-and-error phase of GST is not the sole ground for allowing the petitions in favour of the taxpayers. Several courts, including this Court, have delved into the rationality/validity of the statutory provisions. Recently, in a batch of petitions, this Court had the occasion to deal with the legal effect of the time period pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar the arguments. When the hearing commenced on 14th December, 2020, we noticed that there were multiple issues regarding the TRAN-1 Form and asked the counsels to file a summary note so that we could club the present petitions into smaller batches on the basis of commonality of issues involved therein. 11. In this backdrop, we have categorized the petitions into four batches. The first three batches are being dealt with in the present judgment, and the remainder of the cases are being decided by separate judgments. For the sake of convenience, the three batches dealt with in the present judgment are tabulated below: BATCH NUMBER COMMONALITY WRIT PETITION NUMBERS First Batch Where taxpayers have evidence of attempt to file TRAN-1 Form. Writ Petition Nos. 1150/2020, 2326/2020, 12486/2019, 1224/2020, 3759/2020, 3760/2020, 3761/2020 and 3766/2020. Second Batch Where taxpayers do not have any proof of attempt to file TRAN-1 Form W.P.(C.) Nos. 12162/2019, 12686/2019, 3793/2020, 3988/2020, 3996/2020, 12608/2019, 1232/2020, 3690/2020, 5847/2020, 3758/2020, 13680/2019 and 1831/2020 Third Batch Petitioners have submitted the TRAN-1 Form within the prescribed time period but thei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orm after the cut-off date i.e., 27th December, 2017. In light of the circular dated 3rd April, 2018 which extended the filing of TRAN-1 Form for those persons who were in possession of evidence of technical glitches (hereinafter "April Circular"), the Petitioner addressed letters to Respondents dated 12th July, 2018 and 14th February, 2019. The same were rejected vide communication dated 27th March, 2019. The Petitioner reiterated its concerns in its letter dated 12th April, 2019. Thereafter, a communication dated 8th July, 2019 was addressed by the Assistant Commissioner (Systems) to the Principal Nodal Officer, ITGRC wherein it was stated that the Petitioner's request was genuine and the same was to be forwarded to GSTN for necessary action. The last communication addressed by the Petitioner was on 28th January, 2020 but, nothing further has been heard from the Respondent. iii) W.P.(C.) No. 12486/2019- The Petitioner attempted to file TRAN-1 Form on multiple occasions prior to 27th December, 2017 but could not file it within time on account of system failure in accepting the information. On 28th December, 2017, the Petitioner addressed a letter to the Commissioner, GST express ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... RC had rejected the Petitioner's application. The final communication made by the Petitioner in this regard was on 20th November, 2019. v) W.P.(C.) No. 3759/2020- As on 30th June, 2017, the Petitioner had a credit of eligible duties amounting to Rs. 29,03,018/- which it was entitled to claim as transitional credit as per Section 140 of the Act. The Petitioner made attempts to file TRAN-1 Form prior to 27th December, 2017 but was assailed with technical glitches. This is evidenced by the letters written by the Petitioner dated 20th December, 2017 and 26th December, 2017 to the Commissioner, DGST and Proper Officer, DGST respectively, which are annexed as Annexures P-2 and P-3 respectively. Further, letters were addressed to the Proper Officer, DGST and Commissioner, DGST on 15th May, 2018 and 5th June, 2020. vi) W.P.(C.) No. 3760/2020- The Petitioner was entitled to a transitional credit of eligible duties of Rs. 1,12,79,082/-. The Petitioner attempted to file its TRAN-1 Form on 27th December, 2017 but was unable to upload it successfully. Further attempts were made on 28th and 29th December, 2017 but were unsuccessful. Eventually, the Petitioner resorted to sending manual copie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i. On 26th March, 2019 the Petitioner received a letter from the Assistant Commissioner, CGST to the Assistant Commissioner, Dept. of Trade and Taxes wherein it was stated that the Petitioner fell within the jurisdiction of the State GST authorities and accordingly, the case of the Petitioner was being forwarded for necessary action. The Petitioner again sent a request letter to the Commissioner, CGST, South Delhi vide letter dated 31st December, 2019 as well as a letter to the State GST authorities to re-open the GST Portal. It received a copy of a letter sent by the Assistant Commissioner, CGST to the Assistant Commissioner, Dept. of Trade and Taxes wherein it was once again reiterated that the Petitioner fell within the jurisdiction of the State GST authorities. The last communication addressed by the Petitioner to the State GST authorities was on 17th May, 2020. B. Contention of Respondents 14. In response to the grievance raised above, the Respondents, per contra, contend that CENVAT credit is not an absolute or vested right but a creation of statute, and can only be availed of within the boundaries of the statute and not de hors it. It was further argued that a rule fixing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r has not been accepted by the Respondents. The stand of the Respondent is that in such matters there is no technical anomaly in filing of the TRAN-1 Form on the GST portal. This Court in several decisions has given benefit to such taxpayers and even to those who did not have any evidence to support their filing of TRAN-1 Form within time. In SRC Aviation (P) Ltd. v. Union of India and Ors. MANU/DE/4345/2019, this Court, after recording the fact that Petitioner has placed a copy of the screenshot evidencing that it was unable to file the TRAN-1 Form on the GST Portal, allowed it to file the TRAN-1 Form electronically, or manually. The relevant portion of SRC Aviation (supra) reads as under: "9. The factual position in the present case is not any different. At this juncture, it may be noted that as per Notification No. 49/2019: MANU/CGST/0051/2019 dated 09.10.2019 issued by CBIC, the date prescribed for filing of Form GST TRAN-1 under Rule 117 (1A) of the CGST Rules has been extended to 31.12.2019. This itself demonstrates that the Respondents recognise the fact that the registered persons were not able to upload the Form GST TRAN-1 due to the glitches in the system. It is not fai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... however for the sake of completeness, we shall only quote the necessary facts hereunder- i) W.P.(C.) No. 12162/2019- The Petitioner, despite repeated attempts and correspondences exchanged with the Respondent authorities, was unable to find a way around the technical glitches that arose on the GST Portal when attempts to upload the TRAN-1 Form were made. On 27th September, 2018, the Petitioner wrote a letter to the VATO, Ward-61 seeking assistance in filing of TRAN-1 Form. The Petitioner wrote another letter on 11th February, 2019 to the VATO, Ward-61 and again on 13th February, 2019 to Commissioner CGST, South West, Bhikaji Cama Place, New Delhi, seeking his help in filing TRAN-1 Form. In the interregnum, the Petitioner was informed by the Assistant Commissioner, CGST vide letter dated 7th March, 2019 that he was to raise his grievance before the jurisdictional State GST officer. Through another letter dated 29th March, 2019, the Commissioner, State GST was informed that despite the Petitioner being in touch with the GST Helpdesk, he could not file the TRAN-1 Form and thereafter, the grievance of the Petitioner remained unaddressed. ii) W.P.(C.) No. 12686/2019- the Petitioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... support the claim. The Petitioner in its letter dated 5th March, 2019 expressed its inability to provide any proof to back its claim that it was unsuccessful in filing the TRAN-1 Form. vi) W.P.(C.) No. 1232/2020- The Petitioner tried filing the online TRAN-1 Form several times in compliance with the requirement of Act, but he was unable to, as the online site for filing the TRAN-1 Form was not functional. Petitioner's officers immediately made several oral representations to the office of the Respondents, but their grievances were not addressed by the Respondents. The Respondents refused to even accept Petitioner's letters or representations. vii) W.P.(C.) No. 3690/2020- The Petitioner was entitled to claim credit of eligible duties amounting to Rs. 6,85,863/-. The Petitioner made multiple attempts to file the TRAN-1 Form, however, the GST Portal logged the Petitioner out of the system, every time an attempt to upload was made. The Petitioner contacted the GST Portal helpline but, each time, empty promises regarding resolution were made. As a result of the same, the Petitioner could not upload the TRAN-1 Form before 27th December, 2017. Thereafter, the Petitioner wrote ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ock. The accountant of the Petitioner attempted to file the TRAN-1 Form before the expiry of the prescribed period but was unable to do so on account of technical glitches. Pursuant to the April Circular, the Petitioner raised its grievances before the Respondents but despite receiving acknowledgement of the same, no relief was given. xi) W.P.(C.) No. 1831/2020- The Petitioner was entitled to a total credit of Rs. 2,40,79,997/- on account of Service Tax CENVAT credit of Rs. 1,62,55,758/- and Rs. 78,24,239/- on account of CENVAT credit under the reverse charge mechanism. Due to certain inadvertent clerical errors and oversight, the CENVAT credit under the reverse charge mechanism could not be claimed in the Form ST-3 return filed for the quarter ending on 30th June, 2017. Thereafter, in order to claim the entire CENVAT credit amount, the Petitioner sought to file the TRAN-1 Form before 27th December, 2017 but was unsuccessful in doing so on account of technical difficulties. The Petitioner, thereafter, approached the concerned authorities in an attempt to raise its grievance. Eventually, the Petitioner was constrained to write a letter to the Principal Commissioner, CGST on 12th M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ognise the fact that the registered persons were not able to upload the Form GST TRAN-1 due to the glitches in the system. It is not fair to expect that each person who may not have been able to upload the Form GST TRAN-1 should have preserved some evidence of it-such as, by taking a screen shot. Many of the registered dealers/traders come from rural/semiliterate background. They may not have had the presence of mind to create any record of their having tried, and failed, to upload the Form GST TRAN-1. They cannot be made to suffer in this background, particularly, when the systems of the Respondents were not efficient. From the documents placed on record, it emanates that the Respondents have no cogent ground to deny the benefit of the Notification No. 49/2019: MANU/CGST/0051/2019 dated 09.10.2019 issued specifically to grant relief to taxpayers who faced difficulty in filing Form GST TRAN-1 due to technical glitches. Thereafter when he engaged in communication with the respondent, there was no genuine ground forthcoming except for stating that the due date for filing of Form GST TRAN-1 was over." 20. It is noted that W.P.(C.) No. 1831/2020 is a case wherein the Petitioner has be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Form claiming unutilized credit on VAT as well as CENVAT, but subsequently it was noticed that the electronic credit register reflected only a sum of Rs. 4,17,042/- on account of unutilized credit of VAT and not the unutilized CENVAT credit to excise duty amounting to Rs. 14,50,716/-. Petitioner submits that due to a technical glitch, the amount of transitional unutilized CENVAT credit of Rs. 14,50,716/- is not reflected in the electronic cash ledger, although the claim of input tax credit of VAT of Rs. 4,17,042/- is reflected in electronic credit ledger. After noticing the above discrepancy, the management of the Petitioner firm made efforts to rectify the TRAN-1 Form already submitted by the Petitioner and also wrote a letter to the Assistant Commissioner of Central Taxes on 25th February, 2020 pointing out the above mistake and requesting them to allow the transitional credit. However, no action has been taken by the Jurisdictional Officer to rectify the mistake and/or permit the Petitioner to submit the revised/rectified TRAN- 1 Form so that the amount of CENVAT transitional credit to which the Petitioner is entitled to is reflected in the electronic credit ledger. ii) W.P.(C. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner may be able to take benefit of the accrued credit, with no success. B. Contention of Respondents 24. In the present set of cases, the Respondents have chosen not to file counter-affidavits despite repeated opportunities. But, in similar cases like the present set, the concerns raised by the Respondents are to the effect that as there is a manifest and admitted error on the part of the taxpayers while filing the TRAN-1 Form, and further, opportunity is sought to revise the same beyond the statutorily prescribed time period. The relief should not be granted as the same would be against the interest of the Revenue. C. Analysis (third batch of cases) 25. In the aforesaid petitions, the taxpayers have filed the TRAN-1 Form within time, however on account of an inadvertent mistake on their part, incorrect details have been submitted via the TRAN-1 Form, and thus, they seek revision/rectification of their TRAN-1 Form. 26. It is seen that since there is no effective mechanism provided for the revision/rectification of TRAN-1 Form, the Petitioners were forced to approach this Court under Article 226 of the Constitution. There is no dispute as to the fact that the Petitioners filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s filed. ---------------- Notes : 1. Siddharth Enterprises v. Nodal Officer, 2019 (29) G.S.T.L. 664 2. A.B. Pal Electricals Pvt. Ltd. v. Union of India and Ors., 2020 (33) G.S.T.L. 8; Bhargava Motors v. Union of India, 2019 (26) G.S.T.L. 164; Triveni Needles Pvt. Ltd. v. Union of India and Ors., (2020) 77 GST 550 (Delhi); Krish Automotors Private Limited v. Union of India and Ors., 2019 (29) G.S.T.L. 584; Blue Bird Pure Pvt. Ltd. v. Union of India and Ors., 2019 (29) G.S.T.L. 660; SKH Sheet Metals Components v. Union of India and Ors., 2020 (38) G.S.T.L.592; SRC Aviation (P) Ltd. v. Union of India and Ors., MANU/DE/4345/2019; Sikka Motors Pvt. Ltd. v. Central Goods and Services Tax and Ors., (2019) 70 GSTR 273 (Delhi); Chogori India Retail Limited v. Union of India, 2019 (29) G.S.T.L. 602; The Tyre Plaza v. Union of India, 2019 (30) G.S.T.L.222; Aman Motors v. Union of India and Ors., (2020) 78 GSTR 421 (Delhi); Aagman Services Private Limited v. Union of India and Ors., (2020) 77 GST 530 (Delhi); Vertiv Energy Pvt. Ltd. v. Union of India, (2020) 79 GSTR 4 (Delhi); Lease Plan India Private Limited v. GNCTD and Ors., (2020) 72 GST ..... X X X X Extracts X X X X X X X X Extracts X X X X
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