Petitioner Rudra Autoparts Distributor filed writ petition praying to allow filing of form GST Tran 1 to enable it to claim transitional credit of eligible duties in respect of inputs held in stock on the appointed day in terms of Section 140(3) of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as CGST Act) read with Rule 117 of the Central Goods and Services Tax Rules, 2017 (hereinafter referred to as CGST Rules).
Declaration in form GST Tran 1 could not be filed because the firm’s business was severely disrupted by sudden flood in October, 2017. Counsel for the petitioner Vinay Shraff submitted that all the conditions as mentioned in Section 140(3) of the Central GST Act were fulfilled and has acquired a substantive right to take credit of eligible duties in respect of transitional stock in his electronic credit ledger. Rule 117 of Central Rules is merely procedural in nature and that being the case it is an established principle of law that substantive rights cannot be denied for procedural infractions. The petitioner is praying for declaration of the due date contemplated under the Rule 117 of the CGST Rules to claim the transitional credit as being procedural in nature and thus merely directory and not a mandatory provision.
Calcutta HC : State and Centre seeks time to file objections.
FULL TEXT OF THE INTERIM HIGH COURT ORDER
Learned advocate appearing for the petitioner submits that the right to avail transitional CENVAT credit in respect of goods held in stock on the appointed day is a substantive right in terms of Section 140(3) of the Central GST Act whereas the Rule 117 of Central Rules is merely procedural in nature and therefore due date contemplated under the Rule 117 of the CGST Rules for filing of declaration of Form GST Tran 1 is directory and not a mandatory provision.
Learned advocates for the State and the Union of India prays time to file affidavit-in-opposition.
Let affidavit-in-opposition be filed within four weeks, reply, if any, be filed within two weeks thereafter.
Let the matter appear in the monthly list of June, 2019.