Facts of the Case

  • The petitioner was unable to file Form GST TRAN-1 for carrying forward transitional input tax credit into the electronic credit ledger.
  • A representation submitted by the petitioner seeking permission to file TRAN-1 was rejected by the Deputy Commissioner of State Tax through an order dated 05.01.2021.
  • The petitioner approached the Jharkhand High Court challenging the rejection and seeking permission to avail transitional credit.
  • During the pendency of the petition, the Hon'ble Supreme Court in Union of India & Another vs Filco Trade Centre Pvt. Ltd. & Another directed GSTN to reopen the common portal for filing/revising TRAN-1 and TRAN-2 forms.
  • Subsequently, the Supreme Court extended the reopening period by another four weeks, allowing the GST portal to remain open from 02.10.2022 for 60 days.
  • The petitioner submitted that its case squarely fell within the scope of the Supreme Court's directions.

Issues Involved

  1. Whether the petitioner should be permitted to file Form GST TRAN-1 for claiming transitional input tax credit despite earlier rejection.
  2. Whether the petitioner was entitled to the benefit of the Supreme Court's judgment in Filco Trade Centre Pvt. Ltd. reopening the GST portal.
  3. Whether the High Court should dispose of the writ petition by extending the benefit granted by the Supreme Court to the petitioner.

Petitioner's Arguments

  • The petitioner contended that the Supreme Court had already directed GSTN to reopen the common portal for filing or revising TRAN-1 and TRAN-2.
  • It was argued that the Supreme Court had clarified that all aggrieved registered taxpayers would be entitled to file or revise TRAN forms irrespective of whether they had filed writ petitions or approached the IT Grievance Redressal Committee.
  • Since the petitioner's case was pending before the High Court before the Supreme Court's decision, the petitioner also deserved the benefit of the extended filing window.
  • Accordingly, the petitioner requested permission to submit TRAN-1 within the period specified by the Supreme Court.

Respondents' Arguments

  • Counsel appearing for the Central GST, GST Network and the State of Jharkhand accepted that the petitioner's case was fully covered by the Supreme Court's judgment in Filco Trade Centre Pvt. Ltd.
  • The respondents did not dispute that the petitioner could avail the benefit of the reopening of the GST portal in accordance with the directions issued by the Supreme Court.

Court Order / Findings

The Jharkhand High Court observed that:

  • The Supreme Court had directed GSTN to reopen the GST portal for filing or revising TRAN-1 and TRAN-2.
  • The Supreme Court had subsequently extended the reopening period.
  • The petitioner was an aggrieved registered taxpayer falling within the category covered by the Supreme Court's directions.
  • Therefore, the petitioner was entitled to submit Form GST TRAN-1 during the window period prescribed by the Supreme Court.
  • The writ petition was accordingly disposed of in terms of the Supreme Court's directions.

The Court further observed that the petitioner's claim for transitional credit would thereafter be examined by the concerned authorities in accordance with law.

Important Clarification

  • The judgment does not independently decide the eligibility of transitional credit.
  • The High Court merely extended the benefit of the Supreme Court's decision in Filco Trade Centre Pvt. Ltd.
  • Eligible taxpayers whose TRAN-1 could not be filed due to technical or procedural reasons were allowed to file or revise the forms during the special reopening period.
  • The actual admissibility of transitional credit remained subject to verification by the GST authorities.
  • The decision reinforces that High Courts can dispose of pending writ petitions by granting relief consistent with subsequent Supreme Court directions.

Sections Involved

  • Section 140 of the Central Goods and Services Tax Act, 2017 – Transitional Arrangements for Input Tax Credit
  • Relevant provisions relating to Form GST TRAN-1
  • Transitional Credit Mechanism under the CGST Act

Link to Download the Order

https://www.mytaxexpert.co.in/uploads/1785395300_2331compressed.pdf

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