Supreme Court allows assessees to claim the missed out Transitional Credit

Granting relief to several assessees who missed the statutory deadline of 27.12.2017 to file the TRAN-1 form, the Supreme Court in UOI v. Filco Trade SLP (C) No. 32709 -2018 has ordered the GSTN to open a 2-month additional window on the Portal from September 1, 2022 to October 31, 2022 for claiming Transitional Credit.

When the GST Laws were introduced w.e.f. 01.07.2017, the Legislature brought TRAN-1 and TRAN-2 forms to allow assessees to carry forward pre-GST input tax credits to the GST system. As per the GST Rules, such claims had to be filed within 90 days from the date when the GST Act came into force (July 1, 2017). The same was extended till 27.12.2017. Thereafter the date for filing of the TRAN-1 Credit was extended further for only those assessees who have failed technical difficulty/glitches while filing the Tran-1 form.

Different High Courts passed directions to the GSTN to either open the Portal for filing of the Tran-1 form or to accept the same manually.  The  GST department approached the Supreme Court challenging the decisions of various High Courts.

The Hon’ble Supreme Court while dismissing the SLP held as follows:

1. Goods and Service Tax Network (GSTN) is directed to open common portal for filing concerned forms for availing Transitional Credit through TRAN-1 and TRAN-2 for two months i.e. w.e.f. 01.09.2022 to 31.10.2022.

2. Considering the judgments of the High Courts on the then prevailing peculiar circumstances, any aggrieved registered assessee is directed to file the relevant form or revise the already filed form irrespective of whether the taxpayer has filed writ petition before the High Court or whether the case of the taxpayer has been decided by Information Technology Grievance Redressal Committee (ITGRC).

3. GSTN has to ensure that there are no technical glitch during the said time.

4. The concerned officers are given 90 days thereafter to verify the veracity of the claim/transitional credit and pass appropriate orders thereon on merits after granting appropriate reasonable opportunity to the parties concerned.

5. Thereafter, the allowed Transitional credit is to be reflected in the Electronic Credit Ledger.

6. If required GST Council may also issue appropriate guidelines to the field formations in scrutinizing the claims.

 

Please see the order of Hon’ble Supreme Court @Union-of-India-Anr.-Vs-Filco-Trade-Centre-Pvt.-Ltd.-Anr.-Supreme-Court-of-India (1)

Yuvraj is an advocate and has completed his B.A. LL.B(Hons) from RGNUL-Punjab. He is a practicing advocate and has been involved in matters pertaining to GST and other indirect taxes as well as Direct Tax. He is active in Writ Courts and has involvement in a few landmark judgments like Pitambra Books Pvt. Ltd. V. Union of India (W.P.C. No. 627 of 2020), and represented Sales Tax Bar Association (Delhi) to resolve GST issues and glitches.