Innovative Motors vs. The Goods And Service Tax

Held

The Court allowed the Writ Petition, directing the respondents to reopen the GST portal and enable the petitioner to upload the requisite forms. The Court noted that the Central Board of Indirect Taxes and Customs (CBIC) itself acknowledged the existence of technical glitches through Circular No. 39/13/2018-GST dated April 3, 2018. The Court found it unreasonable to expect assessees to collect evidence of technical difficulties prior to this circular, as they were not put on notice. Furthermore, the Court observed that Rule 117 was amended by inserting sub-rule (1A) on September 10, 2018, extending the due date for uploading TRAN-1 to March 31, 2019, and subsequently to March 31, 2020. The Court emphasized the distinction between the transition of credit and its utilization after verification by an Assessing Officer, stating that the former is vital for the latter. Drawing support from decisions of the Punjab and Haryana High Court in Adfert Technologies Pvt Ltd and the Gujarat High Court in Avante Tablewares and Siddharth Enterprises, the Court concluded that the petitioner had been diligent in their efforts to upload the forms. The Court directed the respondents to take necessary steps forthwith to facilitate the petitioner's upload.

Facts

The petitioner, Tvl.Innovative Motors, a partner in a business dealing with Yamaha motorcycles, sought a writ of mandamus to direct the respondents to reopen the GST portal and allow them to file Form GST TRAN-1. The petitioner had unutilized input tax credit that needed to be transitioned under the GST regime, implemented on July 1, 2017. The stipulated last date for filing Form GST TRAN-1 was December 27, 2017, as per Rule 117 of the CGST Rules. The petitioner claimed that they faced manifold glitches in accessing the website and uploading the form, preventing them from carrying forward their credit. They highlighted that courts across India have granted relief in similar cases due to technical difficulties with the portal. The petitioner had been filing regular monthly returns but could not avail the benefit of carry-forward credit due to the non-filing of TRAN-1.

Key Issues

1. Whether the petitioner is entitled to a direction to reopen the GST portal for filing Form GST TRAN-1, considering the alleged technical glitches encountered during the stipulated period, and if so, under which provision of law? 2. Whether the respondents' denial of access to the portal for filing TRAN-1 is justified, particularly in light of the circulars and amendments issued by the GST authorities regarding technical difficulties and extensions? Petitioner's Arguments: The petitioner argued that they were unable to file Form GST TRAN-1 due to manifold glitches in accessing the website and uploading the form. They contended that the denial of their legitimate claim by restricting them from filing TRAN-1 was unjustified and against the principles of natural justice. They relied on Circular No. 39/13/2018-GST dated April 3, 2018, which established an IT Grievance Redressal Mechanism, indicating the department's awareness of such glitches. They also pointed to subsequent amendments and notifications extending the due dates for filing TRAN-1. Respondents' Arguments: The respondents argued that the petitioner was negligent in not utilizing the facility for filing TRAN-1 within the extended period, which was withdrawn effective December 28, 2017. They contended that the petitioner was not entitled to avail the input tax credit and that the Writ Petition was liable to be dismissed.