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TMI Blog2025 (1) TMI 1418X X X X Extracts X X X X X X X X Extracts X X X X ..... rom July 2017 to November 2017. 2. The said writ petition was dismissed as infructuous in the light of the order dated 30.09.2020 impugned herein. Relevant portion of the impugned order reads as under:- "Please take notice that the letter received in the reference 1st cited has been examined in detail and inform you that there is no provision to file revised return under the TN GST Act/CGST Act, 2017. Therefore, your request to rectify the returns in GSTR-3B for the period from July 2017 to November 2017 is not capable of compliance." 3. The brief background of the case is that the petitioner was an assessee under the provisions of the Finance Act, 1994 and had reportedly accumulated Input Tax Credit (ITC) for a sum of Rs. 82,91,19,712/-. The petitioner had managed to transition the ITC of Rs. 74,61,65,427/- out of Rs. 82,91,19,712/-, after collating all the necessary informations under the previous regime for the purpose of Section 140 of the CGST Act, 2017. The Form Tran-I itself was electronically enabled by the Central Board of Indirect Taxes sometime during last week of September 2017 on 25.08.2017 to facilitate to transition of ITC that was earned by the registration unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bility was discharged by utilizing the accumulated ITC which had accrued on the procurement of goods and services from 01.07.2017 onwards. 10. The month wise details of the returns filed during the period from July 2017 to November 2017 showing the tax liability and payments through cash ledger and credit ledger are given below: Month Total Value of Supply Total Tax Paid Tax paid in Electronic Ledger Tax paid in Cash Ledger Transitional Credit admissible July 2017 Rs. 6,25,74,28,719/- Rs. 1,13,15,86,524/- Rs. 55,36,96,927/- Rs. 57,78,89,597/- Rs. 82,91,19,712/- August 2017 Rs. 21,90,39,340/- Rs.3,58,91,188/- Rs. 3,58,91,188/- - - September 2017 Rs. 2,91,06,42,002/- Rs. 44,64,74,670/- Rs. 44,64,74,670/- - - October 2017 Rs. 2,77,38,60,969/- Rs. 45,65,98,625/- Rs. 37,77,69,004/- Rs. 7,88,29,621/- - November 2017 Rs. 5,49,94,42,414/- Rs. 99,49,30,557/- Rs. 78,19,71,373/- Rs. 21,29,59,184/- - Total Rs. 17,66,04,13,444/- Rs. 3,06,54,81,564/- Rs. 2,19,58,03,162/- Rs. 86,96,78,402/- Rs. 82,91,19,712/- 11. It is submitted that as reflected above, the petitioner has discharged substantial portion of their output liability for the period July 2017 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndered in the case of Bharti Airtel cited supra is distinguishable on the following aspects: Sl.No. Facts in the case of Bharti Airtel Facts in the present matter a. Assessee had opted to remit tax using cash instead of ITC, and then sought amendment of Form GSTR-3B. The Assessee claimed that had the matching system between GSTR-1 and GSTR-2A been made operational, the petitioner would have been able to avail ITC and would have been able to utilize said ITC to remit GST liability. The petitioner was prevented from transiting the credit from the erstwhile regime to the GST regime as Form GST TRAN-01 was not made operational at the introduction of the GST regime. The petitioner remitted the applicable GST in cash in the absence of any alternative. b. The issue under dispute was relating to output tax liability paid out of cash on account of non operability of Form GSTR-2B and did not deal with transitioned credits. This case pertains to transitional credit, which the petitioner could not transition on account of delay in operationalization of Form GST TRAN-01. Admittedly, the decision in the case of Bharti Airtel cited supra did not deal with the teething tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... length and breadth of the country. 22. The learned counsel for the petitioner submits that the facts are identical in all four corners as there also ITC was the transitional credit of the said assessee during December 2017. In this case also, the petitioner has transitioned the entire credit of Rs. 82,91,19,712/- during the month of December i.e., 27.12.2017. 23. It is submitted that during the aforesaid period, the tax liability that was discharged by the petitioner in cash was Rs. 86,96,78,402/-. Therefore, to that extent of Rs. 74,61,65,427/- ought to be refunded back if not [7,88,29,621 + 21,29,59,184]. 24. The learned counsel for the petitioner also submits that the appeal against the decision of the Division Bench of the Delhi High Court in the above case was also dismissed by the Hon'ble Supreme Court on 15.02.2021 in SLP (Civil) Diary No. 16998/2020. 25. He further submits that the petitioner will debit the corresponding amount of Rs. 74,61,65,527/- or Rs. 57,78,89,597/- as the case may be on receipt of payment. 26. On behalf of the respondent, the learned counsel for the respondent would place reliance on the decision of the Hon'ble Supreme Court in the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d for refund of ITC if any paid on or before the appointed date, of any amount of ITC interest or any other amount paid under the existing law, provided the amount was not carried forward under the GST Act. 31. It is submitted that since the amount was carried forward and transitioned, question of refund of the aforesaid amount was not available to the petitioner. 32. The learned counsel also reiterated the submission of the learned Senior Standing Counsel for respondents 1, 2, 5 & 7 and placed reliance on the decision of the Hon'ble Supreme Court in Bharti Airtel Ltd. Vs. Union of India & Ors. reported in 2020 (38) G.S.T.L 145 (Del). 33. By way of rejoinder, the learned counsel for the respondent would submit that the decision is no in authority for the jurisdiction that has been canvassed in this case. It is submitted that the said decision was rendered in the context of the delay on the part of the assessee to avail ITC. Since the assessee purportedly was awaiting for Form GSTR - 2A with effect from September 2018, by which time, the assessee therein had discharged the tax liability from and out of the electronic cash register in cash. That apart, it is submitted that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d record within the meaning of Chapter VII of the 2017 Rules, which are primary documents and source material on the basis of which self-assessment is done by the registered person including about his eligibility and entitlement to get ITC and of OTL. Form GSTR-2A is only a facilitator for taking an informed decision while doing such self-assessment. Non-performance or non-operability of Form GSTR-2A or for that matter, other forms, will be of no avail because the dispensation stipulated at the relevant time obliged the registered person to submit returns on the basis of such self-assessment in Form GSTR-3B manually on electronic platform. The provision contained in Section 39 (9) of the 2017 Act and Rule 61 of the Rules framed thereunder, as applicable at the relevant time, apply with full vigor to the returns filed by the registered person in Form GSTR-3B. 47. Significantly, the registered person is not denied of the opportunity to rectify omission or incorrect particulars, which he could do in the return to be furnished for the month or quarter in which such omission or incorrect particulars are noticed. Thus, it is not a case of denial of availment of ITC as such. If at all, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egime w.e.f. 01.07.2017, from the erstwhile indirect taxation structure. The petitioner, being an exporter under the GST regime is entitled to undertake zero rated supplies. The petitioner claims to have undertaken exports in the months of July and August, 2017 and since its unutilized Input Tax Credit - to the tune of Rs.3,13,06,050/-, which was accumulated up to June, 2017, was not reflected in its ITC ledger as on 01.07.2017, it could not utilize the same w.e.f. 01.07.2017. The same resulted in the petitioner having to shell out, in cash Rs. 1,37,37,029/- which would not have been required, had the respondents taken care to ensure that the petitioner was able to utilize its accumulated Input Tax Credit in the said months. Even the Form GST TRAN-1 was made available on the portal of the respondents only from 25.08.2017. The business activity in the country could not be expected to come to a standstill, only to await the respondents making the GST system workable. The failure of the respondents in first putting a workable system in place, before implementing the GST regime, reflects poorly on the concerned that the respondents have shown to the difficulties that the trade faced th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er such exemption notifications as are notified by the Government. 39. As per sub-section 2 to Section 140 of the Central Goods and Services Tax Act, 2017, a registered person, other than a person opting to pay tax under Section 10, shall be entitled to take, in his electronic credit ledger, credit of the unavailed CENVAT credit in respect of capital goods, not carried forward in a return, furnished under the existing law by him, for a period ending with the day immediately preceding the appointed day within such time and in such manner as may be prescribed. 40. Section 140 of the Central Goods and Services Act, 2017 is reproduced below: "(1) A registered person, other than a person opting to pay tax under section 10 shall be entitled to take, in his electronic credit ledger, the amount of CENVAT credit [of eligible duties] carried forward in the return relating to the period ending with the day immediately preceding the appointed day, furnished by him under the existing law [within such time and] in such manner as may be prescribed: Provided that the registered person shall not be allowed to take credit in the following circumstances, namely:- (i) where the said amount of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act; (iii) the said registered person is in possession of invoice or other prescribed documents evidencing payment of duty under the existing law in respect of such inputs; (iv) such invoices or other prescribed documents were issued not earlier than twelve months immediately preceding the appointed day; and (v) the supplier of services is not eligible for any abatement under this Act: Provided that where a registered person, other than a manufacturer or a supplier of services, is not in possession of an invoice or any other documents evidencing payment of duty in respect of inputs, then, such registered person shall, subject to such conditions, limitations and safeguards as may be prescribed, including that the said taxable person shall pass on the benefit of such credit by way of reduced prices to the recipient, be allowed to take credit at such rate and in such manner as may be prescribed. (4) A registered person, who was engaged in the manufacture of taxable as well as exempted goods under the Central Excise Act, 1944 (1 of 1944) or provision of taxable as well as exempted services under Chapter V of the Finance Act, 1994, (32 of 1994), but which are liable to tax un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... documents were issued not earlier than twelve months immediately preceding the appointed day. (7) Notwithstanding anything to the contrary contained in this Act, the input tax credit on account of any services received prior to the appointed day by an Input Service Distributor shall be eligible for distribution as[credit under this Act, within such time and in such manner as may be prescribed, even if] the invoices relating to such services are received on or after the appointed day. (8) Where a registered person having centralised registration under the existing law has obtained a registration under this Act, such person shall be allowed to take, in his electronic credit ledger, credit of the amount of CENVAT credit carried forward in a return, furnished under the existing law by him, in respect of the period ending with the day immediately preceding the appointed day [within such time and in such manner] as may be prescribed: Provided that if the registered person furnishes his return for the period ending with the day immediately preceding the appointed day within three months of the appointed day, such credit shall be allowed subject to the condition that the said return ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1957 (58 of 1957); (ii) the additional duty leviable under sub-section (1) of section 3 of the Customs Tariff Act, 1975 (51 of 1975); (iii) the additional duty leviable under sub-section (5) of section 3 of the Customs Tariff Act, 1975 (51 of 1975); [(iv) the additional duty of excise leviable under Section 3 of the Additional Duties of Excise (Textile and Textile Articles) Act, 1978 (40 of 1978);] (v) the duty of excise specified in the First Schedule to the Central Excise Tariff Act, 1985(5 of 1986); (vi) the duty of excise specified in the Second Schedule to the Central Excise Tariff Act, 1985 (5 of 1986); (vii) the National Calamity Contingent Duty leviable under section 136 of the Finance Act, 2001 (14 of 2001); and (viii) the service tax leviable under section 66B of the Finance Act, 1994 (32 of 1994), in respect of inputs and input services received on or after the appointed day. [Explanation 3.- For removal of doubts, it is hereby clarified that the expression "eligible duties and taxes" excludes any cess which has not been specified in Explanation 1 or Explanation 2 and any cess which is collected as additional duty of customs under sub-section (1) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the respective GST enactments contemplates rectification of the returns where a registered person who after filing returns discovers any omission or incorrect particulars therein. 46. As far as this case is concerned, it cannot be said that the returns that was filed by the petitioner was incorrect which warrants a rectification on account of the situation contemplated under Section 39 (9) of the respective GST Act, 2017 viz., omission or furnishing of incorrect particulars in the returns. 47. What has happened in the present case is that the petitioner was unable to transition the ITC that was available under the previous regime before the appointed date viz., 01.07.2017. If transition of such credit viz, transitional credit was allowed then and there seamlessly, the question of petitioner discharging the tax liability in cash for an amount of Rs. 74,61,65,427/- out of Rs. 82,91,19,712/- out of the total tax liability of Rs. 3,06,54,81,564/- during the aforesaid period would not have arisen. 48. Admittedly, the TRAN-01 facility was enabled on the GST portal only on 25.08.2017 which is almost 56 days after the implementation of GST w.e.f 01.07.2017. The petitioner had time u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4,61,65,427/- out of Rs. 82,91,19,712/- which was available to the petitioner under the previous regime. 53. Under Section 54(3)(ii) of the CGST Act, 2017, though the petitioner is entitled to refund of credit accumulated on account of rate of tax on input supplies higher than the rate of tax on output supplies, the petitioner would have been unable to liquidate its credit of ITC in its electronic credit ledger. 54. There will also be no scope for claiming refund of ITC under Section 54(3)(ii) of the CGST Act, 2017 on the aforesaid sum of Rs. 74,61,65,427/- out of Rs. 82,91,19,712/- which was debited by the petitioner from its electronic credit ledger as the aforesaid amount of Rs. 74,61,65,427/- out of Rs. 82,91,19,712/- was not transitioned in time. 55. If the aforesaid ITC was seamlessly made available to the petitioner, the petitioner could have discharged the bulk of its tax liability of Rs.3,06,54,81,564/- of ITC availed and out of transitional ITC and would have been required to pay only the difference of Rs.4,05,58,690/- (Rs. 86,96,78,402 - Rs. 82,91,19,712) in cash, instead of Rs. 86,96,78,402/-. 56. The petitioner cannot be burdened with accumulation of ITC as the pet ..... X X X X Extracts X X X X X X X X Extracts X X X X
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