Facts of the Case

The petitioner approached the Kerala High Court seeking relief regarding the availment of GST Transitional Credit while migrating from the earlier indirect tax regime to the Goods and Services Tax (GST) regime. The grievance arose because the petitioner was unable to effectively claim the eligible transitional credit due to issues encountered during the migration process.

During the pendency of the writ petition, the Hon'ble Supreme Court delivered its landmark judgment in Union of India & Another vs Filco Trade Centre Pvt. Ltd. & Another, issuing comprehensive directions to facilitate taxpayers in filing or revising TRAN-1 and TRAN-2 forms for claiming transitional credit. Since the controversy involved in the present writ petition stood fully covered by the Supreme Court's decision, the Kerala High Court considered the applicability of those directions to the petitioner's case.

Issues Involved

  1. Whether the petitioner should be permitted to avail GST Transitional Credit despite earlier difficulties in filing the prescribed forms.
  2. Whether the directions issued by the Hon'ble Supreme Court in Filco Trade Centre Pvt. Ltd. are applicable to the petitioner's case.
  3. Whether the petitioner is entitled to file or revise TRAN-1 and TRAN-2 forms under the special window directed by the Supreme Court.

Petitioner's Arguments

  • The petitioner submitted that eligible Transitional Credit could not be availed due to difficulties experienced during migration to the GST regime.
  • It was contended that the petitioner should be granted an opportunity to claim the credit in accordance with law.
  • The petitioner relied upon the legal position that taxpayers facing genuine difficulties should not be deprived of lawful Transitional Credit merely because of procedural or technical issues.

Respondents' Arguments

  • The respondents relied upon the legal framework governing Transitional Credit under the GST regime.
  • During the hearing, it was not disputed that the controversy involved in the writ petition stood substantially covered by the judgment of the Hon'ble Supreme Court in Union of India & Another vs Filco Trade Centre Pvt. Ltd. & Another.
  • Accordingly, the respondents accepted that the matter would be governed by the directions issued by the Supreme Court.

Court Order / Findings

The Kerala High Court observed that the issue raised by the petitioner had already been completely addressed by the judgment of the Hon'ble Supreme Court in Union of India & Another vs Filco Trade Centre Pvt. Ltd. & Another (2022 SCC OnLine SC 912).

The Court noted the Supreme Court's directions, which included:

  • GSTN shall reopen the common portal for filing or revising TRAN-1 and TRAN-2.
  • All aggrieved registered taxpayers may file fresh or revised declarations irrespective of whether a writ petition had been filed or whether the matter had been considered by the IT Grievance Redressal Committee.
  • GSTN shall ensure that there are no technical glitches during the reopening period.
  • The jurisdictional officers shall verify the claims within the prescribed period after granting reasonable opportunity of hearing.
  • The admissible Transitional Credit shall thereafter be reflected in the Electronic Credit Ledger.
  • GST Council may issue suitable guidelines for verification of such claims.

Holding that these directions squarely applied to the present matter, the High Court disposed of the writ petition in terms of the Supreme Court's judgment.

Important Clarification

This judgment does not independently decide the merits of the petitioner's Transitional Credit claim. Instead, the Kerala High Court confirmed that the petitioner is entitled to the benefit of the directions issued by the Hon'ble Supreme Court in Filco Trade Centre Pvt. Ltd., thereby allowing the petitioner to avail the statutory opportunity provided for filing or revising TRAN-1 and TRAN-2 forms in accordance with those directions.

Sections Involved

  • Section 140 of the Central Goods and Services Tax Act, 2017
  • Transitional Credit Provisions
  • GST Migration Provisions
  • TRAN-1
  • TRAN-2
  • Section 140 of the Central Goods and Services Tax Act, 2017
  • Transitional Credit Provisions under the GST Regime
  • TRAN-1 and TRAN-2 Filing Provisions

Link to Download the Order-https://www.mytaxexpert.co.in/uploads/1785143305_2066compressed.pdf

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