Rohan Dyes And Intermediates LTD. vs. Union Of INDIA

Held

The Court held that the petitioner is entitled to claim credit of CENVAT and service tax as on June 30, 2017, in accordance with Section 140(1) of the CGST Act, 2017, read with Rule 117 of the CGST Rules, 2017. The Court acknowledged that the petitioner could not upload the GST TRAN-1 form due to technical glitches and had made various representations. Relying on the settled legal position and the decision in M/s Siddharth Enterprises, the Court found that the petitioner's claim for transitional credit is legitimate. The Court also took note of Order No. 01/2020-GST dated February 7, 2020, which extended the time limit for submitting the declaration in Form GST TRAN-1 till March 31, 2020, for registered persons facing technical difficulties. Consequently, the Court directed Respondent No. 4, the jurisdictional officer, to verify the petitioner's claim of CENVAT and service tax credit and permit them to upload the GST TRAN-1 form within two weeks from the receipt of the order, enabling the petitioner to file it on or before March 31, 2020.

Facts

The petitioner, Rohan Dyes and Intermediates Ltd., a company registered under the Companies Act, 1956 and the CGST Act, 2017, sought to carry forward CENVAT and service tax credit amounting to Rs. 9,06,154 and Rs. 38,83,511 (Excise Duty) and Rs. 13,53,244 (Service Tax) as per Section 140(3) of the CGST Act, 2017, read with Rule 117 of the CGST Rules, 2017. The petitioner claimed that they were unable to file the GST TRAN-1 form due to technical glitches on the GST portal. Despite approaching the GST Department and the Nodal Officer, their grievance was not addressed. The petitioner filed a writ petition seeking a mandamus to allow them to file the TRAN-1 form and claim the transitional credit.

Key Issues

1. Whether the petitioner is entitled to carry forward CENVAT and service tax credit under Section 140(3) of the Central Goods and Services Tax Act, 2017, read with Rule 117 of the Central Goods and Services Tax Rules, 2017, despite being unable to file the GST TRAN-1 form due to technical glitches? Petitioner's contention: The petitioner argued that Section 140(3) entitles them to carry forward CENVAT and service tax credit available as of June 30, 2017. They contended that failure to file TRAN-1 due to technical issues should not deprive them of this legitimate credit, which is crucial for their working capital, citing the decision in M/s Siddharth Enterprises vs. The Nodal Officer and the principles laid down in Indsur Global Ltd. v. Union of India regarding the unreasonableness of restrictions and double taxation. They also referred to CBEC Flyer No. 20 dated January 1, 2018, clarifying that double taxation on the same goods is not intended. Revenue's contention: The respondents initially stated that no technical glitches were found in the petitioner's case. However, on a specific query, the learned standing counsel submitted that if the claim for transitional credit is found to be genuine upon verification, the petitioner can file/upload GST TRAN-1. Respondent No. 4 would look into the genuineness of the claim.