Facts of the Case

M/s Ajmer Diesels and Tractors filed a writ petition before the Rajasthan High Court at Jodhpur concerning its grievance relating to GST transitional credit and the facility for filing or revising the relevant TRAN-1 and TRAN-2 forms.

During consideration of the writ petition, the Rajasthan High Court observed that the issues involved had already been resolved by directions of the Hon’ble Supreme Court of India. The High Court reproduced the Supreme Court directions governing reopening of the common GST portal for availing transitional credit through TRAN-1 and TRAN-2.

The Supreme Court directions, as reproduced in the Rajasthan High Court’s order, required the Goods and Services Tax Network (GSTN) to open the common portal for filing the concerned transitional credit forms for a period of two months, initially from 01.09.2022 to 31.10.2022.

The High Court further recorded that this period had been extended until 30.11.2022 by virtue of Circular No. 180/12/2022-GST dated 09.09.2022. Consequently, the Court found that the grievance raised by the petitioner had been addressed.

Issues Involved

The principal issues involved were:

  1. Whether an aggrieved registered assessee should be permitted to file or revise TRAN-1 and TRAN-2 forms for claiming GST transitional credit.
  2. Whether such opportunity was available only to taxpayers who had earlier approached a High Court or whether it extended to all aggrieved registered assessees.
  3. Whether a taxpayer could avail the reopened filing opportunity irrespective of whether its case had earlier been considered or decided by the Information Technology Grievance Redressal Committee (ITGRC).
  4. Whether the petitioner’s grievance continued to survive after the common GST portal was opened for TRAN-1 and TRAN-2 filing and the period was further extended until 30.11.2022.
  5. What procedure was to be followed by the concerned tax officers for verification of transitional credit claims after filing or revision of the forms.

Petitioner’s Arguments

The order does not record detailed submissions of the petitioner separately. However, from the nature of the proceedings and the relief addressed by the Court, the petitioner’s grievance concerned the opportunity to claim GST transitional credit through the relevant TRAN-1 and TRAN-2 forms.

The petitioner’s case was effectively considered in the context of the subsequent Supreme Court directions providing a general opportunity to aggrieved registered assessees to file or revise the relevant transitional credit forms.

The relief sought therefore stood addressed once:

  • the common portal was directed to be opened;
  • eligible aggrieved registered assessees were permitted to file or revise the relevant forms;
  • the relief was made available irrespective of prior writ proceedings or ITGRC decisions; and
  • the filing period was further extended until 30.11.2022.

Respondent’s Arguments

The Rajasthan High Court’s short disposal order does not separately record detailed arguments advanced by the respondents.

The respondents were represented before the Court, but the order primarily proceeded on the basis that the controversy had already been resolved through the Supreme Court’s directions and the subsequent extension of the filing period under Circular No. 180/12/2022-GST.

Accordingly, no independent detailed adjudication of rival submissions was considered necessary.

Court Order / Findings

The Rajasthan High Court made the following material findings:

1. Issues Already Resolved by Supreme Court Directions

The High Court expressly observed that the issues involved in the writ petition had been resolved by the Hon’ble Supreme Court of India through the judgment/directions referred to in the order.

The High Court reproduced the operative directions governing transitional credit claims.

2. GSTN Directed to Open the Common Portal

The Supreme Court directions reproduced by the High Court required GSTN to open the common portal for filing the concerned forms for availing transitional credit through TRAN-1 and TRAN-2 for two months, namely:

01.09.2022 to 31.10.2022

3. Opportunity Extended to Any Aggrieved Registered Assessee

A significant direction reproduced in the order was that any aggrieved registered assessee could file the relevant form or revise an already filed form.

This opportunity was not confined only to taxpayers who had previously instituted writ proceedings.

4. Prior High Court Writ Petition Not Mandatory

The benefit was available irrespective of whether the taxpayer had earlier filed a writ petition before a High Court.

Thus, access to the reopened transitional credit mechanism was not made dependent upon prior litigation.

5. ITGRC Decision Not a Bar

The opportunity was also available irrespective of whether the taxpayer’s case had been decided by the Information Technology Grievance Redressal Committee (ITGRC).

6. GSTN Required to Ensure Absence of Technical Glitches

The reproduced directions required GSTN to ensure that there were no technical glitches during the permitted filing period.

7. Officers Given 90 Days for Verification

The concerned officers were granted 90 days thereafter to:

  • verify the veracity of the transitional credit claim;
  • examine the matter on merits;
  • grant an appropriate reasonable opportunity to the parties concerned; and
  • pass appropriate orders.

8. Allowed Transitional Credit to Reflect in Electronic Credit Ledger

Where transitional credit was allowed after verification, it was required to be reflected in the taxpayer’s Electronic Credit Ledger.

9. GST Council Could Issue Appropriate Guidelines

If required, the GST Council could issue appropriate guidelines to field formations for scrutiny of transitional credit claims.

10. Filing Opportunity Extended Until 30 November 2022

The Rajasthan High Court specifically recorded that the initial opportunity from 01.09.2022 to 31.10.2022 had been further extended until 30.11.2022 by virtue of Circular No. 180/12/2022-GST dated 09.09.2022.

11. Petitioner’s Grievance Treated as Addressed

In view of the reopening of the opportunity to file TRAN-1 and TRAN-2 forms and the extension of the period, the High Court held that the grievance raised by the petitioner had been addressed.

Accordingly:

  • the writ petition was disposed of; and
  • the stay application was also disposed of.

Important Clarification

This order should be understood with the following important qualifications:

  • The Rajasthan High Court did not independently adjudicate the quantum or admissibility of the petitioner’s transitional credit claim on merits.
  • The Court did not direct automatic allowance of transitional credit.
  • Filing or revision of TRAN-1/TRAN-2 did not by itself establish entitlement to the credit claimed.
  • The concerned officers retained authority to verify the veracity of the transitional credit claim.
  • Appropriate orders were to be passed on merits after granting a reasonable opportunity to the parties concerned.
  • Only the transitional credit ultimately allowed after the prescribed process was to be reflected in the Electronic Credit Ledger.
  • The writ petition was disposed of because the filing opportunity had become available and the petitioner’s grievance was treated as addressed.
  • The dates 01.09.2022 to 31.10.2022 and the extension until 30.11.2022 were specific to the directions and circular recorded in this 2022 order and should not be treated as a presently open filing window.

Sections / Legal Provisions Involved

The short order does not expressly identify a particular statutory section of the CGST Act as the provision under which the writ petition was decided. The matter principally concerned the legal framework governing GST transitional credit and TRAN-1/TRAN-2 filing.

For subject-matter classification, the relevant provisions are:

Section 140 of the Central Goods and Services Tax Act, 2017 — Governs transitional arrangements for input tax credit, subject to applicable statutory conditions and amendments.

Rule 117 of the Central Goods and Services Tax Rules, 2017 — Concerns the procedural framework historically associated with submission of declarations for transitional credit in FORM GST TRAN-1.

Article 226 of the Constitution of India — Constitutional writ jurisdiction of the High Court; the uploaded order is in a D.B. Civil Writ Petition.

Circular No. 180/12/2022-GST dated 09.09.2022 — Recorded by the High Court as extending the relevant opportunity until 30.11.2022.

Link to download the order -

https://mytaxexpert.co.in/uploads/1783330733_1127compressed.pdf

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