Petitioner Rudra Autoparts Distributor filed writ petition before Calcutta High Court praying to allow filing of form GST Tran-1 to enable it to claim transitional credit of eligible duties in respect of inputs held in stock on the appointed day in terms of Section 140(3) of the Central Goods and Services Tax Act, 2017 read with Rule 117 of the Central Goods and Services Tax Rules, 2017.
Declaration in form GST Tran 1 could not be filed because the firm’s business was severely disrupted by sudden flood in October 2017. Counsel for the petitioner Vinay Shraff submitted that all the conditions as mentioned in Section 140(3) of the Central GST Act were fulfilled and has acquired a substantive right to take credit of eligible duties in respect of transitional stock in his electronic credit ledger. Rule 117 of Central Rules is merely procedural in nature and that being the case it is an established principle of law that substantive rights cannot be denied for procedural infractions.
The petitioner is praying for declaration of the due date contemplated under the Rule 117 of the CGST Rules to claim the transitional credit as being procedural in nature and thus merely directory and not a mandatory provision.
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