The Hon’ble Supreme Court in the matter of Union of India v. Adfert Technologies Pvt. Ltd. [SLP No. 4408 dated February 28, 2020] has rejected a Special leave Petition filed by the department against the order of the Hon’ble HC, Punjab and Haryana allowing the Respondent to carry forward unutilized pre-GST credit, noting that being a vested right it cannot be denied on the ground of time limit. Further the HC also directed the Petitioners to permit the Respondents to file or revise where already filed incorrect TRAN-1 either electronically or manually.
Facts and held portion of the Hon’ble HC, Punjab and Haryana in Adfert Technologies Pvt. Ltd. v. Union of India [CWP No. 30949 of 2018 (O&M)] is discussed below:
Civil writ petitions in 102 different cases were filed by various taxpayers (“Petitioners”) on account of them not being able to carry forward their unutilized CENVAT credit. The reason for the same being that these taxpayers could not file TRAN-01 (“the form”) and/ or the incorrectly filed the form by the “stipulated last date” i.e. December 27, 2017.
The Petitioners had accrued unutilized credits under the erstwhile laws which were eligible to be carried forward under the new GST regime through filing of form TRAN-01 as per Section 140 of the Central Goods and Services Tax Act, 2017 (“CGST Act”). However, no time limit for the same was prescribed under the relevant section of the said act but Rule 117 of the Central Goods and Services Tax Rules, 2017 (“CGST Rules”) provided for a period of 90 days from the appointed day i.e. July 1st, 2017 which was extended from time to time & the last date was December 27th, 2017.
There were cases where the Petitioners didn’t file the form or filed the form wrongly because of varied reasons such as press release showing last date December 31st, 2017, lack of proper knowledge of computer system, complexity in filling different columns of TRAN-I, system glitches, etc.
The Hon’ble Punjab & Haryana HC passed a very reasoned ruling in the matter of Civil Writ Petition No. 30949 of 2018 dated November 4th, 2019 observing as under:
The above judgment in the case of the Adfert Technologies Pvt. Ltd. v. Union of India [CWP No. 30949 of 2018 (O&M)] has been relied upon in following judgments as well:
to carry forward unutilized cenvat credit by allowing the petitioners to modify or file Form TRAN-1.
By rejecting the department SLP by Supreme Court, it’s now clear that transactional credit is a vested right and could not be denied just for non-filing of TRAN -1/ incorrect filing of Tran-1.
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