By this petition under Article 226 of the Constitution of India, the petitioner sought a grant of the input tax credit in terms of section 140 of Central Goods and Service Tax Act, 2017.
The High Court held that the respondents have no legal authority to retain the amount of credit to which the petitioner is duly entitled on the ground that the time limit for filing revised FORM GST TRAN-1 has elapsed, and retention of the same is violative of Article 265 of the Constitution of India.
The petitioner is inter alia engaged in the manufacture of brass/steel/aluminium electrical wiring accessories, other articles of brass etc. and is registered under the CGST Act. At the time of migration to GST regime, the petitioner had CGST transitional credit to be claimed/transferred to its GST electronic credit ledger in terms of sub-section (1) (2) (5) of section 140 of the CGST Act. It is the case of the petitioner that as the time period to fill details in FORM GST-TRAN-1 had elapsed; the petitioner was not able to amend the form for which the eligible benefit of the input tax credit was denied to it.
While relying on several judgements the petitioner submitted that section 140(1) of the CGST Act clearly permits the assessee to carry forward cenvat available in the closing balance of the cenvat account of the registered person.
The respondent submitted that the rule 117(1) of the CGST Rules, provided for a period of ninety days for filing of FORM GST TRAN-1 which could be extended by another ninety days and, therefore, the intention of the legislature is to provide a maximum window of one hundred and eighty days to allow the filing of FORM GST TRAN1.
The division bench comprising of Justice Harsha Devani and Justice Sangeeta K. Vishen held that, “t is not as if the petitioner has not filed FORM GST TRAN-1 within the time provided by the respondents under the rules. The substantive right of the petitioner to claim transitional credit of such amount is sought to be denied on the ground that the time limit for filing revised FORM GST TRAN-1 has elapsed. The respondents have no legal authority to retain the amount of credit to which the petitioner is duly entitled and retention of the same is violative of Article 265 of the Constitution of India..
While allowing the petition, The Court also directed the respondents that either open the online portal so as to enable the petitioner to again file the rectified FORM GST TRAN-1 electronically or accept the manually filed FORM GST TRAN-1 with corrections.