Case Law Details
Pacific Industries Ltd. Vs Union of India (Rajasthan High Court)
The petitioner is a registered dealer under the GST regime having two industrial units registered in Udaipur. The Union of India prescribed Form GST ITC-02A under the Central Goods and Service Tax Rules, 2017 (hereinafter referred to ‘as the Rules of 2017’) which had to be submitted/uploaded on the portal of the Goods and Service Tax Network (hereinafter referred to as ‘the GSTN Portal’) through which, unutilised input tax credit was permitted to be transferred to a newly registered unit of the assessee within the same State. The State of Rajasthan has also prescribed the same form by amending the Rules of 2017. Prior to 01.02.2019, a person having various business verticals within a State, was not entitled to seek separate registrations for multiple places of business. However, by effect of amendment dated 01.02.2019, a person having multiple business at different places became entitled to separate registrations for each location where his business verticals were being operated. As a single registration was permissible under the unamended provision, the tax liability and the input tax credit accrued to the said single registration. After coming into force of the amendment dated 01.02.2019, separate registrations as per location of business were allowed and accordingly, the tax liability as well as input tax credit would be calculated individually for each unit. Pursuant to this amendment, Rule 41A was introduced in the GST Rules of Center as well as State vide notification dated 29.01.2019. This rule prescribes transfer of unutilised input tax credit lying in the Electronic Credit Ledger of a registered unit to the newly registered unit of an assessee within the same State as per Section 25(2) of the Act. In order to give effect to this mode of filing ITC Credit, Form GST ITC-02A was prescribed which was to be submitted on the GSTN Portal within a month of obtaining the new registration as per Section 25(2) of the GST Act so that the unutilised input tax credit could be transferred from the previously registered unit to the newly registered unit of the assessee.
The petitioner has raised a pertinent grievance in this writ petition that the Form GST ITC-02A was not available on the GSTN Portal for the entire period of 30 days from the registration of its separate business verticals and even till the date of filing of the instant writ petition and as a consequence, the petitioner was denied the opportunity of transferring the unutilized input tax credit to its new registration which became effective on 16.04.2019. The petitioner claims to have uploaded a manual copy and submitted the same to the Deputy Commissioner, CTO Ward, A-Circle Udaipur on 14.05.2019 but the same was not accepted. The petitioner claims to be suffering immense financial difficulty on account of not being able to use the unutilised input tax credit of GST to fulfill the tax liability of the new business registration. The petitioner also raised this issue with the GST Helpdesk and a ticket No.201905145915528 was issued to it on 14.05.2019. In response to this ticket, the petitioner was forwarded a tutorial link. However, this tutorial link was regarding filing of the Form GST ITC-02 and not Form GST ITC-02A. The petitioner submitted another letter to the Deputy Commissioner, CTO Ward, A-Circle Udaipur raising an issue regarding Form GST ITC-02A and the steps taken by the petitioner to submit the said form, but no response was received thereto whereupon, the petitioner approached this Court by way of this writ petition.
Shri Saraswat, learned counsel representing the respondent GST Department, vehemently and fervently opposed the submissions advanced by petitioner’s counsel. However, he too was not in a position to dispute the fact that Form GST ITC-02A was not available on the GSTN Portal within the stipulated period of 30 days from the date of registration of the petitioner’s new business vertical and hence, the petitioner was genuinely and bonafidely prevented from uploading the same. It was also not disputed that the petitioner manually submitted the form to the to the Deputy Commissioner, CTO Ward, A-Circle Udaipur within the prescribed period of 30 days.
As a consequence of the admitted factual position, we are of the firm opinion that the impugned action whereby, the respondents have failed to acknowledge and transfer the input tax credit to the tune of Rs.2,58,03,590/- accruing to the petitioner pursuant to the registration of its new business unit in accordance with Rule 41A of the GST Rules, is grossly illegal, arbitrary and unjust.
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