Page 88 - GSTL_7th May 2020_Vol 36_Part 1

46 GST LAW TIMES [ Vol. 36
41. The Petitioner has sought to distinguish the decisions in Willowood
and JCB India Ltd. contending that the Division Bench was not considering Sec-
tion 140(1) and the right under different sub-sections of Section 140 are different
and operate in different fields and what is relevant for one class cannot be made
applicable to another class. It is submitted that the decisions in JCB India Ltd. and
Willowood have considered Section 140(3) of the Act. We do not think these deci-
sions can be distinguished in this manner. The decisions in JCB India Ltd. and
Willowood have laid down a general principle of law. The question of credit in a
transitional provision being a concession or a right was argued and has been
considered. We have not been shown any decision of this Court to the contrary.
As a matter of judicial discipline, we will have to follow the dicta laid down by
the Division Bench of this Court in JCB India Ltd.
42. The decision of the Supreme Court in the case of Collector of Central
Excise, Pune v. Dai Ichi Karkaria Ltd. [1999 (112) E.L.T. 353 (S.C.)] cited by the Peti-
tioner refers to MODVAT credit and in deciding a corelation of the raw material
and final product. The Apex Court held that it is not as if the credit can be taken
only on the final product manufactured out of a particular raw material in which
the credit is related. It was held that the credit may be taken on a final product on
the very day it has become available. It is in this context, the nature of MODVAT
credit was held to be indefeasible. The Learned Additional Solicitor General has
rightly distinguished this decision by pointing out that this decision does not
consider the contingency of time-limit on availment of credit, and also not in a
transitionary provision. Under the impugned Rule, the input credit has been de-
nied per se, but a time-limit has been placed on its availment.
43. The Cenvat Credit Rules prescribe conditions for availment of that
credit. The rights and privileges accrued during the existing law have been saved
under Section 174 of the Act. If what is saved from the earlier regime was condi-
tional, then it cannot be converted to something without conditions in the new
regime during the period of transition. If, before and after the GST regime, the
availment of input credit is conditional, it cannot be that it is without any limit in
the transitional period. With the advent of an entirely new tax regime, the earlier
credit could have lapsed, but as and by way of concession it is permitted to be
carried forward for a limited time. Thus, going by the scheme of the Act, under
Section 140(1), the reference to input tax credit is not by way of a right, but as a
concession.
44. The Petitioner advanced certain ancillary submissions. First, Section
164(1) contemplates recommendation of the GST Council, and the GST Council
had recommended a longer period. It was contended that the GST Council rec-
ommendations are binding regarding the rule-making power. However, this ar-
gument overlooks that power under Section 164(2) is without prejudice to the
power under Section 164(1) regarding the recommendation of the GST Council.
45. Second, that the same relief sought for by the Petitioner can be
granted under Section 54 of the Act and, therefore, necessary directions be is-
sued. This argument is advanced for the first time across the bar with no plead-
ings or prayers. The Respondents had no opportunity to deal with the same.
46. Third, the scheme of the Act is that there is self-declaration which
has to confirmed later and, therefore, there is no prejudice to the Respondents if
credit is given now. It was contended that the submission of return under Section
140 is subject to confirmation under the provisions governing Assessment. This
submission is incorrect. Acceptance of Assessment is not subject to confirmation

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