2021-TIOL-245-SC-GST-LB
UoI Vs Cummins Technologies India Pvt Ltd
GST - The petitions have been filed by Department under Article 139A r/w Article 142 of the Constitution of India seeking transfer of two Writ Petitions to this Court pending before High Court of Madhya Pradesh and the High Court of Andhra Prdesh - In both the Petitions, constitutional validity of Section 16(2)(c) of CGST Act, 2017 has been challenged - Even though Department insisted for transfer of cases pending before various High Courts to this Court, this court is not inclined to entertain these transfer petitions, for the reason that various High Courts are already seized of the matters - The High Court of Madhya Pradesh is requested to dispose of the petition pending adjudication before it within a period of two months - So far as other Petitions, which are pending before various High Courts, it is open for the parties to bring this Order to the notice of concerned High Courts and seek expeditious disposal of their cases: SC
- Transfer Petitions disposed of: SUPREME COURT OF INDIA
2021-TIOL-1879-HC-ALL-GST
Ratek Pheon Friction Technologies Pvt Ltd Vs Pr.Commissioner
GST - Writ petitions has been filed seeking relief in the nature of mandamus commanding the respondent authorities to allow the petitioners to submit/revise/re-revise electronically, their respective declarations on Form GST TRAN-1 and GST TRAN-2, under the provisions of the Central Goods and Services Tax Act, 2017 and, the Uttar Pradesh Goods and Services Tax Act, 2017 , to carry forward the CENVAT and VAT Input Tax Credit, under the CGST Act, 2017 and the U.P. GST Act, 2017 - Some of the petitioners claim, they had submitted electronically, the Form GST TRAN-1 and/or TRAN-2 (on the GST Portal), within time, but errors had crept in that Form so submitted; that they attempted to correct/revise that Form GST TRAN-1 and/or TRAN-2 on the GST Portal within time granted for the same but could not succeed due to technical glitches on the GST Portal; that they have evidence of such attempt/s made - In the second type of cases, the petitioners claim, they could not submit electronically, the Form GST TRAN-1 and/or TRAN-2 within time granted (despite efforts made), due to technical glitches on the GST Portal; that they have evidence of such attempt/s made - The third type of cases, involve a variety of the first two types described above, however, they do not have any evidence of such attempt made to submit or revise electronically, the Form GST TRAN-1 and/or TRAN-2 - Thus, the petitioners claim denial of full benefit of transition credit arising from transactions performed under the repealed indirect tax enactments.
Held:
+ No procedural law may be valid or held mandatory, if there exists physical impossibility or unreasonable difficulty/obstruction, to comply with the same.
+ State was obligated to provide a robust and wholly reliable GST Portal to comply with that law. Failure or inability to provide that reliable online platform would render the strict time prescription (made under Section 140 of the CGST Act read with Rule 117 of the CGST Rules), arbitrary and, therefore, violative of Article 14 of the Constitution of India.
+ CBIC recognized that there were IT related glitches on the GST Portal resulting in compliances remaining from being made by a vast section of "registered persons". Once that difficulty was recognized to have existed on a pan-India basis, over a long duration of time, the CBIC, in its own wisdom, created a mechanism to resolve the same. [Circular dated 3 April 2018 refers]
+ A long and burdensome transition was attempted all over the country, by all indirect taxpayers. It compounded that difficulty further. The Court cannot remain unmindful of the fact that numerous writ petitions came to be filed all over the country, before different High Courts wherein some Courts granted interim relief while in other cases, final orders came to be passed allowing the complaining "registered persons"/taxpayers, time to submit/revise the Form GST TRAN-1/TRAN-2, electronically.
+ Present batch of writ petitions have been instituted from the year 2018 to 2021. It corresponds to the period when similar petitions were filed and were decided in favour of other "registered persons"/taxpayers, by other High Courts, allowing them margin of time to submit/revise electronically, Form GST TRAN-1 and/or TRAN-2.
+ Bench is of the opinion that the difficulties claimed were generic as had been recognized by the CBIC itself vide his circular dated 03.04.2018 as also by various decisions of the other High Courts.
+ Petitioners were obstructed and remained disabled (generally) owing, not to any conduct attributable to them but owing solely to factors beyond their control and for reasons attributable to the respondents. Consequently, it would be arbitrary, to enforce strict timeline prescribed under the Act and the Rules framed thereunder, against them.
+ Rule of law and good administration go hand in hand.
+ Though unintentional on part of the State authorities, it cannot be lost sight that the obstruction thus caused was attributable only to the conduct of the State authorities since, the GST Portal is a creation of the State authorities and the responsibility to run the same seamlessly, rests exclusively on them.
+ The "registered persons"/taxpayers, whose rights were adversely impacted by the lack of smooth operation of the GST Portal, could not be saddled with any civil consequences arising from the non-functioning or improper or irregular functioning of the GST Portal.
+ In absence of existence of any statutory requirement (at the relevant time), that burden (to produce evidence) would now involve recalling from memory, the number of attempts made and the time and date when such attempt was made - to retrieve electronic trail of that event.
+ In absence of any enabling law, that burden cast on the "registered persons"/tax payers - to lead evidence of difficulty faced, is wholly arbitrary and unreasonable and therefore unenforceable. To enforce that condition is plainly not protected by any Statute or Rule.
+ At the relevant time, there was no requirement in law and even today, there is no requirement either under the Act or the Rules, to obtain evidence of every attempt made to submit Form GST TRAN-1 or TRAN-2. It is only by way of the Circular instruction dated 3.4.2018 that such a requirement was introduced by the revenue authorities. It is arbitrary and, therefore, unenforceable.
+ CBIC has travelled half the distance required and left the taxpayers in the lurch for the other half.
+ If allowed to work, it would create hostile discrimination between two similarly situated persons based solely on the chance occurrence of one having in his possession proof of attempt/s made to submit/revise/rerevise Form TRAN-1/TRAN-2, electronically, though he was not required (by law), to obtain or maintain such evidence.
+ Any law that may differentiate between two similarly situated persons based on a chance occurrence/s and allow the valuable civil rights of a citizen to be prejudiced, based solely on that, would remain exposed to the vice of arbitrariness and, therefore, be invalid.
+ The clear intent of the legislature is to grant benefit of CENVAT and ITC under the pre-existing laws, as may have been carried forward on the appointed date 01.07.2017. In such circumstances, if the GST Portal had worked seamlessly, all petitioners would have submitted/revised/re-revised electronically, their Forms GST TRAN-1 and/or TRAN-2 within the time granted. In that situation, all petitioners would clearly be entitled to avail ITC under the CGST Act and the UPGST Act, without any objection by the State/revenue authorities.
+ Taxing statute and equity considerations are not natural allies.
+ Bench has no hesitation in observing that a reasonable opportunity ought to have been granted to all "registered persons"/taxpayers to submit/revise/re-revise electronically their Form GST TRAN-1/TRAN-2.
++ All the writ petitions allowed with the following directions:
(i) All petitioners may first file physical Form GST TRAN-1/TRAN-2 before their respective jurisdictional authority, within a period of four weeks.
(ii) That jurisdictional authority shall then make a report in writing on the same, as to compliances contemplated under Section 140 of the CGST Act and Rule 117 of the CGST Rules.
(iii) In case, no objection be taken, a report to submit/revise/re-revise the Form GST TRAN-1/TRAN-2 electronically, would be made by the concerned jurisdictional authority, within a period of two weeks.
(iv) In the event of any objection arising, one limited opportunity may be given to that petitioner to correct or revise or re-revise the physical Form GST TRAN-1/TRAN-2. That exercise may be completed within a period of three weeks.
(v) Upon completion of that exercise, the jurisdictional authority shall forward his report along with said physical GST TRAN-1/TRAN-2 to the GST Network, within a further period of one week, with a copy of that communication to the petitioner concerned, through Email or other approved mode.
(vi) The GST Network shall thereupon either itself upload the GST TRAN-1/TRAN-2, within two weeks of receipt of such communication or allow that petitioner opportunity to upload those details, within a reasonable time.
++ This order is made applicable to all other "registered persons"/taxpayers within the State of U.P. (who are not before this Court), subject to the modification that such non-petitioners/" registered persons" may approach their jurisdictional authority, within a period of eight weeks from today.
++ Respondents shall host the operative portion of this order on their website and the GST portal to ensure that the one-time/final resolution is made of all disputes of this nature, in the State of U.P. [para 50, 51, 52, 59, 60, 61, 63, 64, 65, 67, 68, 69, 71, 72, 73, 75, 76]
- Petitions allowed: ALLAHABAD HIGH COURT 2021-TIOL-1877-HC-ORISSA-GST
Sunny Motors Vs CBIC
CGST - The petitioner sought a direction to the Opposite Parties to accept GST TRAN-1 form from the Petitioner in terms of Rule 117 of CGST Rules, 2017 and allow the Input Tax Credit (ITC) claimed by them - The Petitioner was unable to upload the GST TRAN-1 form on account of "some unavoidable and unforeseen circumstances" - The Delhi High Court by the judgment in Aagman Services Private Limited 2019-TIOL-2682-HC-DEL-GST permitted the petitioner to submit his TRAN-1 form either electronically or manually - In that case too, petitioner's case was considered in the meeting of GST Council - Against the said decision, Department filed Special Leave Petition which was dismissed by Supreme Court both on the ground of delay as well as on merits - A direction is issued to the Opposite Parties to either open the portal and permit the Petitioner to file TRAN-1 form electronically on or before 1st November, 2021 or accept the TRAN-1 form from the Petitioner manually before that date - It will be open to the authorities to verify the genuineness of claim of Petitioner in accordance with law and pass appropriate orders: HC
- Writ petition disposed of: ORISSA HIGH COURT |
