Petitioner | Avatar Petro Chemicals Private Limited |
Respondent | Goods and Service Tax Council The Principal Chief Commissioner Union of India The Chairman, Goods and Service Tax Network (GSTIN) Government of Tamil Nadu The Joint Commissioner Superintendent of CGST & IGST |
Decision by | Madras High Court |
Date of order or Judgement | 4-March- 2022 |
Citation no. | 2022 (3) GSTPanacea 72 HC Madras W.P(MD).No.7093 of 2020 |
Hon’ble Judge | Justice C. Saravanan |
Decision | In Favour of Assessee |
No Provision Under GST for Lapsing ITC & Credit on Capital Goods. These credits are indefeasible. They are meant for being used for discharging the tax liability.
No Provision Under GST for Lapsing ITC-Facts of the Case
No Provision Under GST for Lapsing ITC-The petitioner was a Central Excise Assessee. It is submitted that as on month of June 2017, the petitioner had an accumulated CENVAT credit of Rs.5,09,612/- under the provisions of Central Credit Rules, 2004. It is submitted that the aforesaid credit amount remained un-utilised and therefore the petitioner attempted to transition the credit by filing TRAN-1 electronically in terms of Rule 117 of the Central Goods and Services Tax Rules, 2017 read with under Section 140 of Central Goods and Sales Tax Act, 2017 on the common portal. The attempt of the petitioner to upload TRAN-1 in the GST web portal was unsuccessful and whenever the petitioner attempted to open the portal, a pop up dialog box opened stating with a proxy error, as a result of which the petitioner could not transition the unutilized credit TRAN-1 within time. However, the petitioner has captured the screen shot of the pop up dialog.
Argument Before Court
No Provision Under GST for Lapsing ITC-Petitioner’s Contention
The petitioner submits that the petitioner received an e-mail from GST help desk that filing of declaration in TRAN-1 is not available now as the due date is over. It is further submitted that the petitioner is entitled to utilize the credit which existed credit prior to 11.07.2017 in terms of the Delhi High Court in Chogori India Retail Limited Vs Union of India and others in W.P.(C).No. 762 of 2019 dated 09.08.2019.
No Provision Under GST for Lapsing ITC-Respondent’s Argument
The respondent would submit that though a learned Single Judge of this Court in W.P.(MD).No. 7712 of 2018 had granted similar relief vide order dated 15.04.2019, the department has preferred an appeal before the Division Bench of this Court in W.A.(MD).N0.1749 of 2021 and a stay was granted by the Court on 30.07.2021 and therefore it is not open to the respondents to rely on the decision of the Delhi High Court referred supra.
Madras High Court Held
No Provision Under GST for Lapsing ITC-There is no provision under the provisions of the respective GST enactments for lapsing of the input tax credit and the credit availed on capital goods under the respective enactments. These credits are indefeasible. They were meant for being used for discharging the tax liability under the provisions of the erstwhile Central Excise Act, 1944, and under the provisions of Chapter V of the Finance Act, 1994. I do not find any merits in the stand of the respondents to deny the credit, which may have been legitimately earned by an Assessee or a Dealer under the provisions of the respective enactments, which stood subsume into the respective GST enactments. Since uploading of TRAN-1 may be a challenge at this distant point of time due to technicality involved therein, the amount can be credited directly into the petitioner’s GST Electronic Register if such amounts were indeed available on the cut-off-date as of 30.06.2017 for being transitioned. In view of the above, I remit the case back to the jurisdictional authorities to examine the credit in the respective returns of the petitioner which the petitioner claims to have attempted to transition by uploading TRAN-1 after the enactment of GST Act with effect from 01.07.2017 and come to an independent conclusion on the same. In case, credit on such input and/or capital goods existed and had remained unutilized on 30.06.2017 and could have been transferred if TRAN-1 was filed properly, then the proportionate amount shall be credited into the Electronic Credit Register of the petitioner, within a period of 90 days from the date of receipt of a copy of this order.
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