Usha Martin Limited Vs Additional Commissioner, Central GST and Excise (Jharkhand High Court)
GST authorities lacks jurisdiction to examine correctness of credit transitioned from erstwhile tax regime
The Hon’ble High Court, Jharkhand (“the High Court”) in the case of M/s. Usha Martin Ltd. v. Additional Commissioner & Ors. (W.P.(T) No. 3055 of 2022) dated November 10, 2022, quashed the proceedings initiated by Joint Commissioner (“the Respondent”) by issuing Show Cause Notice dated September 13, 2021 (“SCN”) under Section 73 of the Central Goods and Services Tax, 2017 (“the CGST Act”) and held that Goods and Services Tax Authorities (“the GST Authorities”) does not have jurisdiction to determine whether CENVAT credit was admissible under the respective Act.
Facts:
M/s. Usha Martin Ltd. (“the Petitioner”) is engaged in the business of manufacturing iron and steel products and was registered in the Central Excise Act, 1944 (“the Excise Act”) and Finance Act, 1994 (“the Finance Act”) in erstwhile tax regime. Post July 01, 2017, the Petitioner registered under GST. The Petitioner carries forwarded CENVAT credit under GST regime by filing GST TRAN-1. The Respondent issued the SCN alleging that Petitioner could not claim CENVAT credit in lieu of invoices raised by an entity in erstwhile tax regime as the same was contravention of the Excise Act and Finance Act read with Cenvat Credit Rules, 2004 (“CCR”) on March 30, 2022. Thereafter, the Respondent vide Order-In-Original March 30, 2022 (“the Order”) disallowed the CENVAT credit carried forwarded by the Petitioner on the ground stated above.
Petitioner filed the writ petition questioning the jurisdiction of the GST Authorities to examine the correctness of the CENVAT credit.
Issue:
Whether GST Authorities can assess the admissibility of CENVAT credit availed under the pre-GST regime?
Held:
The High Court held that:
