The High Court of Calcutta ruled that in terms of the residuary provisions of the Limitation Act, the period of three years should be the guiding principle, and thus a period of three years from the appointed date would be the maximum period for availing of such CENVAT credit.
The High Court directed the GST Authority to reopen the form TRAN II or accept the manual filing of GST TRAN II to allow the petitioner to claim transitional credit.
In order to comply with the GST regime the petitioner, M/s. Subhas & Company duly filled up an SGST TRAN-I within time and mentioned all the details required to be filled up in said SGST. In order to claim the transitional credit in case of stock of goods as on the appointed date but while trying to file a GST TRAN-II the same could not be filed because the utility was not availed till 27 December 2017. The utility was made available only after the due date to file GST TRAN-I.
Due to such reasons, the statement in form-GST TRAN-II could not be filed since utility aforesaid was not made available. The Government of India issued notification dated March 7, 2018, by way of which sub-clause (iii) of clause (b) of sub-rule 4 of Rule 117 of the West Bengal Goods and Service Tax Rules 2017 was substituted with immediate effect.
Though over such substitution the assessees were directed to file GST TRAN-II within the time limit of 31st March 2018 or within such time as may be extended by the respondent authority.
Even after the due date technical issues while filing the transitional form in FORM GST TRAN-I and TRAN-II and as such could not file the same within the stipulated due date.
The issue raised in the by the petitioner was whether the non-allowance of transitional Credit on account of inputs held in stock as on the appointed date under Section 140(3) of the CGST/SGST Act, 2017 due to inability to file GST TRAN-2 before the due date as provided for in Rule 117 (4) of the CGST/SGST Rules, 2017 is violative of Articles 14, 19(1) (g) and 265 of the Constitution of India and is grossly against the principles of natural justice.
The other issue raised was whether the petitioner is entitled to get an opportunity to file the declaration in CGST TRAN-II in order to be allowed to take transitional Credit on account of inputs held in stock as on the appointed date.
The Single Judge Bench of Justice Shivakant Prasad ruled that in terms of the residuary provisions of the Limitation Act, the period of three years should be the guiding principle and thus a period of three years from the appointed date would be the maximum period for availing of such CENVAT credit.
“This court directs the respondent authorities to reopen the form TRAN II or accept the manual filing of GST TRAN II to allow the petitioner to claim transitional credit held in stock as on the appointed date after proper verification including the invoices submitted by the petitioner. It is made hereby clear that such exercise has to be completed within 30.06.2020 so as to enable the petitioner to submit his GST TRAN II,” the court said.
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