Hygiene (INDIA) PVT. LTD. vs. Union Of INDIA & Ors.

Held

The Court noted that the matter was squarely covered by previous decisions of the Delhi High Court, such as Blue Bird Pure Private Limited v. Union of India & Ors, which had directed the respondents to grant transitional credit. However, the Court also acknowledged the respondents' submission that similar judgments were pending before the Supreme Court with stay orders. Considering that no useful purpose would be served by keeping the petition pending, the Court disposed of the writ petition. The operative direction was to the respondents to either re-open the online portal for the petitioner to file the TRAN-1 Form electronically or to accept it manually within eight weeks. This direction, however, was explicitly suspended during the pendency of the Special Leave Petitions before the Supreme Court and was made subject to the final decision of the Supreme Court in SLP(C) Nos. 7425-7428/2020 and connected matters.

Facts

The petitioner, Hygiene (India) Pvt. Ltd., filed a writ petition seeking directions to carry forward input tax credit (ITC) of Rs. 8,03,555/- in its electronic credit ledger. This credit related to stock held as of June 30, 2017, the appointed day for GST implementation. The petitioner contended that it could not file its GST TRAN-1 within the due date of December 27, 2017, due to technical glitches. Despite representations made to the Nodal Officer in June 2020 and a reminder in March 2021 requesting the opening of the TRAN-1 portal, the respondents failed to extend the filing date, thereby denying the petitioner its transitional credit without fault. The petitioner argued that this denial was unjust.

Key Issues

1. Whether the petitioner is entitled to transitional credit under the Goods and Services Tax (GST) regime, despite failing to file the TRAN-1 form within the prescribed due date due to alleged technical glitches? Petitioner's Contention: The petitioner argued that the denial of transitional credit was due to technical issues beyond its control and that the respondents failed to provide a mechanism for filing the TRAN-1 form, even after repeated requests. They relied on the Delhi High Court's decision in Blue Bird Pure Private Limited v. Union of India & Ors and other similar judgments where the Court had directed the respondents to grant transitional credit. Respondents' Contention: The respondents, represented by Mr. Satyakam, stated that judgments passed by the Delhi High Court on this issue are pending adjudication before the Supreme Court in SLP(C) Nos. 7425-7428/2020, and stay orders have been passed in those matters.