In a significant ruling which may lead to a debate, the Chhattisgarh High Court has stated that the revisal of TRAN-1/2 forms are allowed under the Central GST Act and the recent circular issued by the Central Board of Indirect Taxes and Customs (CBIC) denying the further revisal is legally not permitted.
In the said circular, the CBIC has clarified that the facility is a one-time opportunity for the taxpayers following the Supreme Court decision in Union of India Vs. Filco Trade Centre and there will not be a further revisal of the same once the filing is completed.
Justice P. Sam Koshy was considering a writ petition by . M/s Jagdalpur Motors. The petitioner sought for a direction to reset/ reopen the GST portal filing the GST TRAN-1 form for the petitioner and in effect allow the petitioner to rectify the inadvertent of mistake its consultant or accept the physical copy of the Form GST TRAN-1 and allow eligible transitional credit to the petitioner as per Section 140 of CGST Act and credit such amount in the electronic credit ledger of the petitioner as Input Tax Credit of GST.
The department contended that the order of the Supreme Court was a one time measure that was allowed. That, there was a specific period of time provided by the Supreme Court and it was not to be considered as if that the whole system had to be done in accordance with Act and Rules, but was to be considered strictly in accordance with the subsequent notification and CBIC circular dated 9.9.2022.
Allowing relief to the petitioner, the Court observed that “the period for submission of the form Tran-1 and Tran-2 or portal is open up till 30.11.2022. The petitioner having availed the said benefit and having attempted to submit his form Tran-1 and Tran-2 and where certain inadvertence took place. Under the said circumstances it cannot be said that the provision under Rule 120A would not be applicable. In the case of the petitioner or any other similarly placed person. The submission of the Union of India if at all if has to be accepted then the circular dated 09.09.2022 would have an overriding effect over the statute which otherwise may not be permissible under the law. All circulars and instructions issued by the respondents can be only of clarificatory in nature and it cannot had been diluting the statutory provision or for that matter making the statutory provision redundant.”
Noting that the CBIC circular is primarily a clarification instructions, the Court held that the said clarificatory instructions cannot have an overriding effect over the Act or the Rules.
“When Rule 120A provides for revising of the declaration in form GST Tran-1 once, only because the portal has been opened as a one time measure by itself cannot be construed that the Rule 120A cannot be made applicable when the period for submission of Form Tran-1 is still open in terms of the order of the Supreme Court even as on date. The Supreme Court also has nowhere held that the applicability of Rule 120A would not be available to those persons who are to submit their Form Tran-1 and Tran-2 in terms of its order,” the Court said.
Concluding the order, the Court concluded that “This court therefore is of the opinion that taking into consideration the Rule 120A, it is ordered that the respondents No.1 & 2 may instruct the respondent No.5 to open the portal so far as the petitioner is concerned for once in terms of Rule 120A permitting the petitioner to revise the declaration and thereafter permit him to submit the same and complete the filing.”
The respondents No.1,2 and 5 are further directed to ensure that all necessary steps are taken as far as possible before the time limit provided by the Supreme Court i.e. by 30.11.2022 if not at the earliest. The petitioner also should take all necessary steps to submit the same within the said time period. It is made clear that there cannot be any further permission for revision granted to the petitioner.
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