Page 24 - GSTL_20th August 2020_Vol 39_Part 3

J56 GST LAW TIMES [ Vol. 39
• At the same time the Court also cautioned against false claims of
credit made by any taxpayer in the extended period.
5. Take away :
• While going through the different High Court cases arguments and
the judgment delivered, the following observations can be made :
(a) The provisions of the Section 140 is not mandatory and only
directory.
(b) Transitional credit is a vested right and is protected under
Article 300A of the Constitution of India which cannot be
taken away due to procedural lapse.
(c) Denying the transitional credit violates Article 14 of the Con-
stitution of India.
(d) Civil rights can be enforced within 3 years under the Limita-
tion Act, 1963, which should be applicable to GST also.
(e) Denial of the transitional credit affects the working capital
and may diminish the ability of the taxpayers to continue
with the business and such action violates the mandate of Ar-
ticle 19(1)(g) of the Constitution of India.
6. Repeal and Saving :
• Without prejudice to the provisions of Section 140 of CGST Act, we
may look into the provisions of “Repeal and saving” (Section 174 of
CGST Act).
• Sub-section (2) of Section 174, elucidates that right, privilege ….
shall not be affected by the introduction of GST law.
• The said section while repealing the earlier enactments saves all
rights and liabilities.
• The relevant part of Section 174 reads as under :
“174. Repeal and Saving. -
(2) The repeal of the said Act and the amendment of the Finance Act,
1994 (hereafter referred to as “such amendment” or “amendment
Act”,) to the extent mentioned in the sub-section (1) or section 173
shall not -
(c) affect any right, privilege, obligation, or liability acquired, accrued
or incurred under the amendment Act or repealed Acts or orders
under such repealed or amended Acts………”
• Transitional credit being a right has been saved and allowed to be
claimed under Section 140.
7. Stay by Supreme Court :
• In the meantime, on 19-6-2020, the Supreme Court of India [2020
(38) G.S.T.L. J24 (S.C.)] has stayed the operation of the High Court’s
order in Brand Equity Treaties Limited case mentioned above.
8. Conclusion :
• The use of technology can be daunting for many taxpayers who
hitherto before, were largely dependent on conventional manual fil-
ing of returns.

GST LAW TIMES  20th August 2020  24