The India Cements Limited vs The Union Of India
2021 Latest Caselaw 7180 Raj

HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR S.B. Civil Writ Petition No. 275/2020

The India Cements Limited, Having Its Registered Office At Dhun Building, 827 - Anna Salai, Chennai - 600 028, Tn, Corporate Office At Coromandal Towers, 93, Santhome High Road, Karpagam Avenue, R.a. Puram, Chennai - 600028, And One Of Its Plant At Wajwana, Tehsil - Garhi, Dist- Banswara - 327 025, Rajasthan Through Its Authorised Representative- Mr. Krishan Murari Sharma S/o Late Shri Mangi Lal Sharma, Age - 47 Years, Resident Of Banswara (Rajasthan).

----Petitioner Versus

1. The Union Of India, Through Its Secretary, Ministry Of Finance,3Rd Floor, Jeevan Deep Building, Sansad Marg, New Delhi.

2. The State Of Rajasthan, Through Its Principal Secretary, Department Of Finance, Secretariat, Jaipur.

3. The Assistant Commissioner, Central Excise Commissionerate Udaipur, 142-B, Hiran Magri Sector-11, Udaipur.

4. The Deputy Commissioner, State Goods And Service Tax Department, Dahod Road, Banswara.

----Respondents

For Petitioner(s) : Mr. Shreyansh Mardia For Respondent(s) : Mr. Mukesh Rajpurohit, ASG.

Mr. Sandeep Shah, AAG.

Mr. Rajvendra Sarswat.

HON'BLE DR. JUSTICE PUSHPENDRA SINGH BHATI

Order

15/03/2021

1. In wake of onslaught of COVID-19, abundant caution is

being taken while hearing the matters in Court.

2. This writ petition under Article 226 of the Constitution of

India has been preferred claiming the following reliefs:

"a) Permit and allow the Petitioner to revise/correct/file afresh declaration in GST Form TRAN-1 to enable it to claim transitional credit of eligible duties to the tune of Rs.7,89,421/- (Rupees Seven Lakhs Eighty Nine Thousand Four Hundred and

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Twenty One Only), in respect of unavailed credit on Capital Goods on the appointed day in terms of Section 140(2) of the Central Goods and Services Tax Act, 2017;

b) Declare the impugned action of the Respondents in not refunding/adjusting the unavailed CENVAT Credit existing in the name of the Petitioner as illegal and same be quashed and set aside;

c) Direct and declare that the time limit to file Form TRAN-1 specified in Rule 117(1) & 1(A) & Rule 120A of the Central Goods and Service Tax Rules, 2017 as being ultra vires Section 140(2) of the Central Goods and Service Tax Act, 2017 as also being arbitrary and unreasonable and violative of Article 14, 19(1)(g) and 265 of the Constitution of India.

d) Direct and declare that due date contemplated under the Rule 117 of the CGST Rules to claim the transitional credit within a specified period of time as being procedural in nature and thus merely directory and not a mandatory.

e) Direct Respondent No.4 to refund/carry forward the unavailed CENVAT Credit in the Electronic Ledger maintained by the Petitioner forthwith along with 18% interest."

3. Learned counsel for the petitioner submits that the petitioner

had submitted the Form GST TRAN-1 under Section 140 of the

Central Goods and Service Tax Act, 2017 in order to carry forward

the eligible credit on capital goods on 13.12.2017.

Learned counsel further submits that the petitioner made a

mistake in feeding the wrong details of unavailed CENVAT Credit of

Rs.7,89,420.76.

Learned counsel also submits that the petitioner thereafter, took

up the issue with the respondents in April, 2019 upon realizing

such mistake.

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4. Learned counsel for the petitioner relied upon the judgment

rendered by a Division Bench of this Hon'ble Court in Obelisk

Composite Technology Llp Vs. Union of India & Ors. (D.B.

Civil Writ Petition No.18392/2019 decided on 12.12.2019),

relevant portion of which reads as under:

"8. Accordingly, upon taking the aforesaid submissions into consideration, we are of the considered view that the challenge to the constitutional validity of Rule 117 no more being res integra, this Court cannot entertain such prayer and accordingly reject the same, however, considering the fact that the Union of India and the Finance Department have extended the period contemplated under Rule 1A of Rule 117 till 31 st December, 2019, we grant liberty to the petitioner to make an application before GST Council (through Standing Counsel, who is further requested to hand over the same to the jurisdictional officer) for forwarding the same to the GST Council to issue requisite certificate of recommendation alongwith requisite particulars, evidence and a certified copy of the order instantly and such decision be taken forthwith and if the petitioner's assertion is found to be correct, the GST Council shall issue necessary recommendation to the Commissioner to enable the petitioner to get the benefit of CENVAT credit within the stipulated time as stipulated by the Union of India i.e on or before 31st December, 2019."

5. Learned counsel for the petitioner has also placed reliance on

the judgment rendered by a Division Bench of the Hon'ble Punjab

& Haryana High Court in Adfert Technologies Pvt. Ltd. Vs.

Union of India & Ors. (CWP No.30949 of 2018 (O&M)

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decided on 04.11.2019), relevant portion of which reads as

under:

"4. From the perusal of record and arguments of counsel for both sides, we find that there are two types of cases namely (i) registered persons who did/could not file TRAN-1 by 27.12.2017 and have no evidence of attempt to load TRAN-1 (ii) registered persons loaded TRAN-1 by 27.12.2017 but there is mistake and they want to revise already loaded TRAN-1.

8. From the conjoint reading of above quoted provisions, we find that:

i) A registered person to carry forward or avail credit of duty/tax paid on inputs and capital goods under old taxation statutes was required to file TRAN-I;

ii) Certain restrictions are prescribed in proviso to Section 140(1) but restriction in terms of time frame is prescribed under Rule 117 (1) of the Rules;

iii) As per Rule 117 (1), TRAN-1 was required to be filed by due date which was declared 27.12.2017. There is no power under Rule 117 (1) to extend last date beyond 27.12.2017, however Rule 117(1A) was inserted w.e.f. 10.9.2018 by which last date was extended upto 31.12.2019.

iv) The last date i.e. 27.12.2017 prescribed under Rule 117(1) was extended upto 31.12.2019 where TRAN-I could not be filed due to technical glitches. In other words a registered person who is able to establish that he has failed to file TRAN-I by 27.12.2017 due to technical glitches was entitled to file TRAN-I upto 31.12.2019.

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v) There is no provision to permit filing of TRAN-1 at subsequent stage who failed to furnish evidence of attempt to file by 27.12.2017.

vi) As per Rule 120A, one time amendment is permitted within time prescribed under Rule 117, 118, 119 or 120 or within the time period as may be extended by the Commissioner.

The Introduction of Rule 117(1A) & Rule 120A and absence of any time period prescribed under Section 140 of the Act indicate that there is no intention of government to deny carry forward of unutilized credit of duty/tax already paid on the ground of time limit.

9. Having scrutinized record of the case(s) and heard arguments of both sides, we find that on the introduction of GST regime, Government granted opportunity to registered persons to carry forward unutilized credit of duties/taxes paid under different erstwhile taxing statues. GST is an electronic based tax regime and most of people of India are not well conversant with electronic mechanism. Most of us are not able to load simple forms electronically whereas there were a number of steps and columns in TRAN-1 forms thus possibility of mistake cannot be ruled out. Various reasons assigned by Petitioners seem to be plausible and we find ourselves in consonance with the argument of Petitioners that unutilized credit arising on account of duty/tax paid under erstwhile Acts is vested right which cannot be taken away on procedural or technical grounds. The Petitioners who were registered under Central Excise Act or VAT Act must be filing their returns and it is one of the requirements of Section 140 of CGST Act, 2017 to carry forward unutilized credit. The

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Respondent authorities were having complete record of already registered persons and at present they are free to verify fact and figures of any Petitioner thus inspite of being aware of complete facts and figures, the Respondent cannot deprive Petitioners from their valuable right of credit.

Learned counsel for the petitioner thereafter submits that the

Union of India has preferred Special Leave to Appeal (C)

No.4408/2020 before the Hon'ble Supreme Court against the

judgment rendered in Adfert Technologies Pvt. Ltd. (supra),

which was decided on 28.02.2020, while affirming the judgment

rendered by the Division Bench of the Hon'ble Punjab & Haryana

High Court.

6. Reliance has also been placed by learned counsel for the

petitioner on the judgment rendered by a Division Bench of the

Hon'ble Delhi High Court in M/s. Blue Bird Pure Pvt. Ltd. Vs.

Union of India & Ors. (W.P. (C) No.3798/2019 decided on

22.07.2019), relevant portion of which reads as under:

"15. Accordingly, this Court directs the Respondents to either open the online portal so as to enable the Petitioner to again file the rectified TRAN-1 Form electronically or accept the manually filed TRAN-1 Form with the correction on or before 31st July, 2019"

7. Learned counsel for the petitioner further relied upon the

judgment rendered by a Division Bench of this Hon'ble Court at

Jaipur Bench in Trivedi Ventures LLP Vs. Union of India &

Ors. (D.B. Civil Writ Petition No.4182/2020 decided on

30.07.2020), relevant portion of which reads as under:

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"Hence, the writ petitions are liable to be disposed of in terms of the decision rendered by Co- ordinate Division Bench of this Court Principal Seat at Jodhpur in Obelisk Composite Technology LLP (supra).

Accordingly, we grant liberty to the petitioners to make an application before GST Council through Standing Counsel, who is further requested to hand over the same to the jurisdictional officer for forwarding the same to the GST Council to issue requisite certificate of recommendation alongwith requisite particulars, evidence and a certified copy of the order instantly and such decision be taken forthwith and if the petitioners' assertion is found to be correct, the GST Council shall issue necessary recommendation to the Commissioner to enable the petitioners to get the benefit of CENVAT credit within the stipulated time as stipulated by the Union of India."

8. Learned counsel for the petitioner however, submits that the

deadline of 27.12.2017 for technical glitches was diluted upto

March, 2020, and therefore, the petitioner's approaching the

Department in 2018 would not amount to delay.

9. On the other hand, learned counsel for the respondents

submits that the key difference between the precedent law cited

on behalf of the petitioner and the facts of the present case is that

the last date for filling-up the Form GST TRAN-12 was 27.12.2017,

but the petitioner has woken up on his right to rectify and amend

his mistake only in April, 2018. Learned counsel further submits

that the said delay in approaching the Department amounts to a

non-curable default on the part of the petitioner, which cannot be

cured at this belated stage.

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10. Learned counsel for the respondents also submits that this

Hon'ble Court in M/s. Shree Motors Vs. Union of India & Ors.

(S.B. Civil Writ Petition No.440/2020 decided on

18.03.2020) has, in the second round of litigation, upheld the

decision taken by the respondents regarding the dispute arising

therein out of the submission of Online Form GST TRAN-1, while

rejecting the claim of the petitioner therein on merits.

11. Learned counsel for the respondents lastly submits that the

respondents being flexible on the issue of technical glitches does

not amount to extending the same benefit to the petitioner, who

had committed a mistake, for which it ought to have owed

complete responsibility.

12. After hearing learned counsel for the parties as well as

perusing the record of the case, alongwith the precedent laws

cited at the Bar, this Court is of the considered opinion that the

Hon'ble Courts in the precedent laws cited above on behalf of the

petitioner have dealt with two types of defaults; firstly, the

registered persons loaded TRAN-1 by 27.12.2017, but there is a

mistake and they want to revise the already loaded TRAN-1;

whereas, secondly, the registered persons, who could not file

TRAN-1 by 27.12.2017 and have no evidence of attempt to load

TRAN-1.

13. This Court finds that the petitioner took all necessary steps

of abiding by the law by filling the Form GST TRAN-1 before

27.12.2017 i.e. on 13.12.2017.

14. This Court further finds that the issue is no more res integra

as the delay and all other aspects have been dealt with by the

Hon'ble Courts one after another, and the propositions of

permission to make the necessary amendments in light of the new

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regime of GST have been affirmed upto the Hon'ble Supreme

Court in Adfert Technologies Pvt. Ltd. (supra).

15. Thus, this Court finds no reason not to go with the settled

view taken by the Division Bench of the Hon'ble Punjab & Haryana

High Court in Adfert Technologies Pvt. Ltd. (supra) as well as

affirmation thereof by the Hon'ble Supreme Court, as mentioned

hereinabove.

16. Accordingly, the present petition is allowed, and this Court

grants liberty to the petitioner to make an application before GST

Council (through Standing Counsel, who is further requested to

hand over the same to the jurisdictional officer) for forwarding the

same to the GST Council to issue requisite certificate of

recommendation alongwith requisite particulars, evidence and a

certified copy of the order instantly and such decision be taken

forthwith and if the petitioner's assertion is found to be correct,

the GST Council shall issue necessary recommendation to the

Commissioner to enable the petitioner to get the benefit of

CENVAT credit. Such an exercise shall be completed within a

period of six months from today, strictly in accordance with law.

The stay application and all pending applications stand disposed of

accordingly.

(DR.PUSHPENDRA SINGH BHATI),J.

12-SKant/-

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