Facts of the Case

The petitioner, Sanjay Agencies, approached the Jharkhand High Court seeking a direction to the GST authorities to permit the filing of Form GST TRAN-1 for carrying forward eligible transitional input tax credit from the pre-GST regime into the GST regime. The petitioner's earlier representation for allowing the filing of TRAN-1 had been rejected by the Deputy Commissioner of State Tax, Ranchi, through an order dated 05.01.2021. During the pendency of the writ petition, the Supreme Court delivered its judgment in Union of India & Another vs Filco Trade Centre Pvt. Ltd. & Another, directing the reopening of the GST common portal for filing or revising TRAN-1 and TRAN-2 forms for all eligible taxpayers.

Issues Involved

  1. Whether the petitioner should be permitted to file Form GST TRAN-1 for claiming transitional input tax credit despite the earlier rejection of its representation.
  2. Whether the petitioner is entitled to the benefit of the Supreme Court's directions issued in Union of India vs Filco Trade Centre Pvt. Ltd. for reopening the GST portal.
  3. Whether taxpayers having pending writ petitions are also entitled to avail the special window provided by the Supreme Court for filing TRAN-1 applications.

Petitioner's Arguments

  • The petitioner submitted that it had been unable to file Form GST TRAN-1 and consequently could not carry forward eligible transitional credit into its electronic credit ledger.
  • It relied upon the judgment of the Supreme Court in Union of India & Another vs Filco Trade Centre Pvt. Ltd. & Another, wherein the Court directed GSTN to reopen the common portal for filing or revising TRAN-1 and TRAN-2 forms.
  • It was further submitted that the Supreme Court subsequently extended the time for reopening the portal, thereby enabling all eligible taxpayers, including those whose cases were pending before High Courts, to avail the benefit.
  • The petitioner requested that it also be permitted to file TRAN-1 during the special window provided by the Supreme Court.

Respondents' Arguments

  • The learned counsel appearing for the CGST, GSTN, and the State of Jharkhand fairly conceded that the petitioner's case was squarely covered by the directions issued by the Supreme Court in Union of India vs Filco Trade Centre Pvt. Ltd.
  • The respondents did not dispute the applicability of the Supreme Court's judgment to the facts of the present case.

Court Order / Findings

The Jharkhand High Court examined the Supreme Court's judgment dated 22.07.2022 and the subsequent order dated 02.09.2022, whereby the period for reopening the GST common portal was extended.

The Court observed that:

  • The Supreme Court had permitted all aggrieved registered taxpayers to file or revise TRAN-1 and TRAN-2, irrespective of whether they had approached any High Court or whether their cases had been decided by the Information Technology Grievance Redressal Committee (ITGRC).
  • Since the petitioner's case clearly fell within the scope of the Supreme Court's directions, it was entitled to avail the benefit of the reopened portal.
  • Accordingly, the petitioner was permitted to submit Form GST TRAN-1 within the window period specified by the Supreme Court.
  • The writ petition was disposed of with the observation that the petitioner's claim would be governed by the directions issued by the Supreme Court in Filco Trade Centre Pvt. Ltd.

Important Clarification

  • The judgment reiterates that all eligible taxpayers, including those who had already filed writ petitions or whose requests had earlier been rejected, are entitled to the benefit of the Supreme Court's directions for filing or revising GST TRAN-1 during the special reopening period.
  • The High Court confirmed that once the Supreme Court reopened the GST portal, pending writ petitions involving similar issues would be governed by those directions.
  • The decision reinforces that transitional input tax credit claims are to be processed in accordance with the verification mechanism prescribed by the Supreme Court after filing of TRAN-1.

Sections Involved

  • Section 140 of the Central Goods and Services Tax Act, 2017 – Transitional Arrangements for Input Tax Credit.
  • Rule 117 of the Central Goods and Services Tax Rules, 2017 – Submission of Form GST TRAN-1.
  • Article 226 of the Constitution of India – Writ Jurisdiction of High Courts.

Link to Download the Order

https://www.mytaxexpert.co.in/uploads/1785395264_2328compressed.pdf


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