Page 54 - GSTL_2nd April 2020_Vol 35_Part 1

J20 GST LAW TIMES [ Vol. 35
approached the Finance Ministry, seeking clarity on several aspects regarding
the Central Board of Indirect Taxes and Customs (CBIC) notification issued on
21-3-2020 and a follow-up circular on 23-3-2020, people familiar with the devel-
opment said.
They wanted to know whether separate Goods and Services Tax registra-
tion was mandatory for completing compliance of the company undergoing in-
solvency, and whether it is needed to be taken in all locations where it has prem-
ises.
They also sought clarity on the category of registration, the mechanism
of invoicing and transition of Input Tax Credit balance between corporate debtor
and the IRP, sources said.
“Clarity on the process of surrendering the registration post completion
of resolution plan has also been sought,” one of them said on condition of ano-
nymity adding that some representations have been sent to the Finance Ministry.
Since the notification treats an IRP as distinct person from the corporate
debtor, some IRPs wanted to know whether any taxable supply transaction be-
tween such distinct persons considered free of cost, sources said.
[Source : The Economic Times, New Delhi, dated 27-3-2020]
GST Rule prescribing time-limit to file TRAN-1 not Ultra
vires : Bombay HC
The Bombay High Court has recently that the time-limit prescribed to
file TRAN-1 under Rule 117 of Goods and Services Tax Rules, 2017 is not ultra
vires of Central GST Act, 2017.
The petitioner namely Nelco Ltd. is a Company incorporated under the
Companies Act. It supplies and undertakes various network-related services. The
Petitioner had accumulated Cenvat credit during its activities and payment of
taxes. The Transition Form or TRAN-1 is filed by the taxpayers who are eligible
to claim the credit on the tax already paid in the pre-GST regime.
However, the petitioner was unable to file the return TRAN-1 due to
some technical difficulties on the common portal. Despite so many requests from
the petitioners, no direction was issued to the Respondents to treat the case of the
Petitioner as falling within the ambit of Rule 117(1A) of Central Goods and Ser-
vices Rules, 2017.
The Division Bench comprising Justices Nitin Jamdar and M.S. Karnik
held that “the existence of technical difficulties as seen from the system logs at
the common portal is a cogent proof. The system log on the common portal does
not support the case of the petitioner. This has been communicated to the Peti-
tioner. No direction was issued to the Respondents to treat the case of the peti-
tioner as falling within the ambit of Rule 117(1A) of Central Goods and Services
Rules.”
With regard to the constitutionality of the provision, the Court ruled that
“the time-limit stipulated under Rule 117 of the Rules is not ultra vires of the Act.
This Rule is traceable to the power conferred under Section 164(2) of the Act. The
time-limit stipulated in Rule 117 is in consonance with the transitional nature of
the enactment, and it is neither arbitrary nor unreasonable. Availment of Input
Tax Credit under Section 140(1) is a concession attached with conditions of its
exercise within the time-limit.”
[Source : http://www.taxscan.in, dated 27-3-2020]
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