Facts of the Case

The petitioners approached the Kerala High Court seeking relief in relation to the availment of Transitional Input Tax Credit during migration to the Goods and Services Tax (GST) regime. They were unable to file or correctly revise their TRAN-1/TRAN-2 declarations for claiming eligible transitional credit due to difficulties encountered while migrating to the GST system.

During the pendency of these writ petitions, the Hon'ble Supreme Court delivered its landmark judgment in Union of India & Anr. vs Filco Trade Centre Pvt. Ltd. & Anr., comprehensively addressing the issue relating to Transitional Credit.

Accordingly, the Kerala High Court examined whether any further adjudication was necessary in view of the Supreme Court's directions.

Issues Involved

  1. Whether taxpayers should be permitted to file or revise TRAN-1 and TRAN-2 forms for claiming Transitional Input Tax Credit.
  2. Whether taxpayers who faced technical or procedural difficulties while migrating to GST should receive an opportunity to claim legitimate transitional credit.
  3. Whether the directions issued by the Supreme Court in Filco Trade Centre should govern the pending writ petitions before the Kerala High Court 

Petitioners' Arguments

The petitioners contended that they were entitled to Transitional Input Tax Credit under the GST law but could not effectively submit or revise their TRAN declarations because of practical and technical difficulties encountered during the migration to the GST regime.

They requested the Court to permit them to avail the eligible transitional credit by allowing filing or revision of the prescribed forms.

Respondents' Arguments

The matter was considered in light of the subsequent judgment of the Hon'ble Supreme Court in Filco Trade Centre, which had already laid down a uniform mechanism applicable to all eligible taxpayers for filing or revising TRAN-1 and TRAN-2 forms and verification of transitional credit claims.

Consequently, the controversy stood substantially covered by the Supreme Court's decision.

Court Order / Findings

The Kerala High Court observed that the controversy involved in the writ petitions had already been conclusively settled by the Hon'ble Supreme Court in Union of India & Anr. vs Filco Trade Centre Pvt. Ltd. & Anr.

The Court held that the Supreme Court's directions would fully apply to the present cases.

Accordingly, the writ petitions were disposed of by directing that the petitioners shall receive the benefit of the Supreme Court's order, which included:

  • GSTN shall reopen the common portal for filing or revising TRAN-1 and TRAN-2.
  • All aggrieved registered taxpayers shall be permitted to file fresh or revised declarations irrespective of whether they had earlier approached any High Court or IT Grievance Redressal Committee.
  • GSTN shall ensure that no technical glitches occur during the reopening period.
  • Proper officers shall verify the claims within the prescribed period after granting reasonable opportunity of hearing.
  • Eligible Transitional Credit shall thereafter be reflected in the Electronic Credit Ledger.
  • GST Council may issue appropriate operational guidelines for field officers regarding verification of such claims.

The writ petitions were accordingly disposed of in terms of the Supreme Court's directions.

Important Clarification

This judgment does not independently determine the merits of the Transitional Credit claims. Instead, it recognizes that the issue already stands settled by the Hon'ble Supreme Court in Filco Trade Centre and extends the benefit of that landmark ruling to the petitioners.

The decision reinforces that eligible taxpayers who faced difficulties in filing TRAN-1 or TRAN-2 should receive an opportunity to claim Transitional Input Tax Credit in accordance with the Supreme Court's directions.

Link to Download the Order

https://www.mytaxexpert.co.in/uploads/1785561588_2465compressed.pdf 
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