GST Caselaw

#GSTCase-55-Gist of Cases on TRAN-1 (Jan-Feb 2019)- Petitioner allowed to take credit on documents evidencing payment of Duty since no documents have been prescribed U/Sec 140(3)(iii) till date, Error in Filing or Non Filing of TRAN-1 due to technical Glitches

#GSTCase-55-Gist of Cases on TRAN-1 (January 2019)- Petitioner allowed to take credit on documents evidencing payment of Duty since no documents have been prescribed U/Sec 140(3)(iii) till date, Error in Filing or Non Filing of TRAN-1 dur to technical Glitches

 

Case-1: Downtown Auto (P.) Ltd v. Union of India [2019] 102 taxmann.com 431 (Gujarat)

Case-2: Philoden Industries (P.) Ltd. v. Union of India [2019] 102 taxmann.com 324 (Gujarat)

Case-3: Edayar Metals v. Union of India [2019] 102 taxmann.com 190 (Kerala), Leo Logistics v. Union of India [2019] 102 taxmann.com 125 (Kerala), Coastal Freez Tech & Sanitaries v. Goods Service Tax Council [2019] 102 taxmann.com 70 (Kerala)

Case-4: Popular Vehicles & Services Ltd. v. Union of India [2019] 102 taxmann.com 126 (Kerala)

Case-5: Yadu Sugar Ltd. v. Union of India [2019] 102 taxmann.com 67 (Allahabad)

Case-6: Bhargava Motors v. Union of India [2019] 102 taxmann.com 127 (Delhi)

 

Case-1: Downtown Auto (P.) Ltd v. Union of India [2019] 102 taxmann.com 431 (Gujarat)

Issue: No documents have been prescribed U/Sec 140(3)(iii) till date, therefore petitioner is entitled to take credit on the basis of documents in possession of the petitioner evidencing payment of duty.

Contention by the Petitioner: Section 140(3)(iii) same provides that said registered person should be in possession of invoice or other prescribed documents evidencing payment of duty under the existing law in respect of such inputs. It was submitted that in the facts of the present case, no documents have been prescribed under the Central Goods and Services Tax Rules. Since no documents have been prescribed till date, therefore when petitioner has produced documents evidencing payment of duty, he is entitled to the credit in respect thereof.

Held: By way of ad-interim relief, the respondents are restrained from making any coercive recovery against the petitioner in connection with the subject matter of this petition.

 

Case-2: Philoden Industries (P.) Ltd. v. Union of India [2019] 102 taxmann.com 324 (Gujarat)

Issue: Failure to File TRAN-1 and issue of Technical Glitches raised before CGST Officer whereas petitioner was allocated to SGST Officer

Facts: Petitioner is allocated to State Tax Authorities under the GST regime and that despite the fact that the petitioner falls under the jurisdiction of the State Tax Authorities, Nodal Officer of CGST forwarded the issue of technical glitches raised by the petitioner to the concerned GSTN authorities. It is not known whether this issue was raised by the petitioner with the Nodal Officer of the State Authorities, who was the proper officer to forward their grievance of the technical glitches to GSTN. Learned advocate for the petitioner states that he would make an application for allowing the credit of the central excise and duty under the Form-GST TRAN-1 to both the authorities, namely, the State Tax Authorities as well as the Central Tax Authorities.

Held: Issue Notice to the newly added respondent Nos. 6 and 7 returnable on 30.1.2019. Mr. Utkarsh Sharma, learned Assistant Government Pleader to take instructions in the matter

 

Case-3: Edayar Metals v. Union of India [2019] 102 taxmann.com 190 (Kerala), Leo Logistics v. Union of India [2019] 102 taxmann.com 125 (Kerala), Coastal Freez Tech & Sanitaries v. Goods Service Tax Council [2019] 102 taxmann.com 70 (Kerala)

Issue: Petitioner attempted to upload the Form but it failed because of system error

Facts: Petitioner, a registered dealer under Kerala Value Added Tax Act, migrated to GST regime. To use input tax available to its credit at the time of migration, petitioner had to upload FORM GST TRAN-1 within stipulated time. Petitioner asserts that though it attempted to upload the Form within the time, it failed because of some system error. The petitioner, therefore, seeks directions to enable him to take credit of the available input tax.

Held: Not only the petitioner but also many other people faced this technical glitch and approached this Court. Petitioner may apply to Nodal Officer. Petitioner applying, Nodal Officer will look into the issue and facilitate the petitioner’s uploading FORM GST TRAN-1, without reference to the time-frame. If petitioner applies within two weeks after receiving this judgment, Nodal Officer will consider it and take steps within a week thereafter. If the uploading of FORM GST TRAN-1 is not possible for reasons not attributable to the petitioner, the authority will also enable it to take credit of the input tax available at the time of its migration.

 

Case-4: Popular Vehicles & Services Ltd. v. Union of India [2019] 102 taxmann.com 126 (Kerala)

Issue: Acceptance of Manually filled TRAN-1 and resultant TRAN-2 in view of the error in filing the same on account of the technical reasons

Facts: The petitioner approached this Court seeking a direction to the respondents to accept the petitioner’s manual filing of revised FORM GST TRAN-I and the resultant FORM GST TRAN-2 in view of the error in filing the same on account of the technical reasons.

Held: Respondents submitted that they have no objection in allowing the petitioner’s request in view of the fact that it was occurred on account of the technical reasons. In view of the above, the fourth respondent is directed to accept FORM GST TRAN-I and FORM GST TRAN-2 from the petitioner manually. The petitioner shall submit FORM GST TRAN-I and FORM GST TRAN-2 within one week from the date of receipt of a copy of this judgment. If the petitioner submits FORM GST TRAN-I and FORM GST TRAN-2 within the time as above, the fourth respondent shall accept and transmit it into the electronic credit ledger of the petitioner within a further period of one week.

 

Case-5: Yadu Sugar Ltd. v. Union of India [2019] 102 taxmann.com 67 (Allahabad)

Issue: Electronic portal was not functioning because of some technical glitches in the GST portal and therefore, it could not file its returns

Facts: The petitioner in the writ petition is seeking a direction to the respondents to grant them the option to file GST TRAN-1, by opening the GST portal. The case of the petitioner is that electronic portal was not functioning because of some technical glitches in the GST portal and therefore, it could not file its returns.

Held: Respondents are directed to file their counter affidavit within one month. In the meantime, the respondents are directed to reopen the portal within two weeks from today. In the event they do not do so, they will entertain the application of the petitioner manually and pass orders on it after due verification of the credits as claimed by the petitioner. They will also ensure that the petitioner is allowed to pay taxes on the regular electronic system also which is being maintained for use of the credit likely to be considered for the petitioner.

 

Case-6: Bhargava Motors v. Union of India [2019] 102 taxmann.com 127 (Delhi)

Issue: Uploaded TRAN-1 but Credit Ledger did not reflect of appropriate credits available to it but rather that the electronic ledger reflected no figure at all, as credit available to it.

Facts: The petitioner’s grievance is that the credit it claimed in TRAN-I Form, uploaded on 27.12.2017, pursuant to the mandate of the law [Section 140(3) of the Central Goods and Service Tax Act, 2017] did not result in reflection of appropriate credits available to it [which it claims to be to the tune of Rs.74,96,069/- and Rs.10.5 lakhs approximately], but rather that the electronic ledger reflected no figure at all, as credit available to it.

Contention by GST Network: The affidavit filed on behalf of the respondent No.4/GST Network, which manages/administers electronic portal inter alia states as follows:

“19.1 state that the non-availability of the CGST credit is not due to non-filing of the FORM GST TRAN-1. In this regard, it is reiterated that the Petitioner filed the FORM GST TRAN-1 but all the ITC fields were zero. It is denied that this is not due to the fault of the Petitioner.”

Held: The conundrum which the Court is presented with here is that if the petitioner were to obtain a screenshot of the figures it had filled just before it actually uploaded TRAN-I, the Revenue would have then contended that those figures were inchoate as the document would not have been final and was merely at the stage of preparation. It also appears to the Court that after the electronic form is filled, no provision for its “review” was made available to the assessee before uploading it. The lack of this facility has complicated the issue, because if such facility or provision would be made available, the individual assessee could have obtained screenshots just before uploading the form. The other method by which this issue could have been resolved was that the automatically generated response could have itself indicated the figures. That, however, does not appear to be the case.

The respondents should disclose as to what was actually filled in the TRAN-I Form [whether for the first time or the second time when it was uploaded], by the petitioner in this case and the basis of its assertion that no credit was available to it, having regard to the fact that the petitioner claims credit on the basis of real transactions in real goods.

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