Page 30 - GSTL_18th June 2020_Vol 37_Part 3

J64 GST LAW TIMES [ Vol. 37
(a) Registered persons who did/could not file FORM GST TRAN-1 by
27-12-2017 and have no evidence of an attempt to load FORM GST
TRAN-1
(b) Registered persons loaded FORM GST TRAN-1 by 27-12-2017 but
there is a mistake and they want to revise already loaded FORM
GST TRAN-1.
The Courts allowed ITC in majority of the cases broadly on following
grounds -
(a) Rules have acted far beyond the scope of the act and hence such ar-
bitrary timelines implied by the rules should be set aside and the
registered person should be allowed to carry forward transitional
ITC.
(b) GST is in “trial & error” [Bhargava Motors v. UOI, 2019 (26) G.S.T.L.
164 (Del.)] phase and FORM GST TRAN-1 could not be uploaded
due to technical glitches in GST portal for which the registered per-
son should not be punished.
Meanwhile, the instant legal anomaly mentioned in point 4(a) supra was
resolved with a retrospective amendment vide Finance Act, 2020 [Section 128 of
the Finance Act, 2020] wherein relevant amendments [Section 140 of the CGST
Act, 2017] were made under the CGST Act, 2017 w.e.f. 1-7-2017 to facilitate the
relevant rules to determine timelines for filing FORM GST TRAN-1. The instant
amendment was made applicable [Notification No. 43/2020-C.T., dated 16-5-
2020] on 18th day of May, 2020 after much celebrated decision of Delhi High
Court [Brand Equity Treaties Limited v. UOI - W.P. (C) No. 11040 of 2018]. Hence,
it appears that the argument mentioned supra in point 4(a) is done away. Ac-
cordingly, only such registered persons who could not submit FORM GST
TRAN-1 by the due date on account of technical difficulties and are recommend-
ed by the GST Council can file FORM GST TRAN-1 up till 31-3-2020 [Order No.
01/2020, dated 7-2-2020].
Accordingly, does the instant amendment suggests that no more ITC can
be availed with respect to transitional credit? Further, does it suggest that all
such ITC will be lapsed? Further, does it also suggest that, for cases whose
GSTIN’s are not recommended by the GST Council and are allowed by the re-
spective Courts or in cases where Courts have allowed for the filing of manual
FORM GST TRAN-1 applications will face recovery notices?
All these are golden questions which would be better answered by make
people rush to Courts because they can expect recovery notices from a tax officer
if his/her case does not fall in the framework [Section 140 of the CGST Act, 2017
read with Rule 117(1A) CGST Rules, 2017] designed under the GST laws. Thus, it
means such persons classified in point 3(a) supra where Courts have allowed
ITC, under changed circumstances, the law warrants a tax officer to recover it
which will ultimately be put to test again.
Thus, the instant amendment is a googly which has been very well
played by the tax authorities. On a conservative note, such persons should de-
posit so much of the amount to avoid mounting of interest and also to prove
ones bona fide which will help them escape from the clutches of penalties.
In our opinion, transitional ITC should not be reversed as there is merit
in this idea which should be tested before the Courts. In our opinion, if such

GST LAW TIMES  18th June 2020  30