Time limit prescribed for transitioning of credit is directory & would not result in forfeiture of rights of assessee: HC

Case Details: Tkt Hightech Cast (P.) Ltd. v. Commissioner of Gujarat, GST - [2022] 139 taxmann.com 58 (Gujarat)

Judiciary and Counsel Details

• • J.B. Pardiwala & Ms Nisha M. Thakore, JJ.
  • D.K. Trivedi for the Petitioner.
  • Ankit Shah & Utkarsh R. Sharma for the Respondent.

Facts of the Case

The writ applicant could not filed Form TRAN-1 for transition of credit within prescribed time period. It approached department with request to allow uploading of Form TRAN-1 but no response was received. It filed writ petition before the High Court with a prayer to direct the authorities to allow the benefits of transitional credit.

High Court Held

The Honorable High Court observed that in case of Brand Equity Treaties Ltd. & Ors. vs. Union of India, [2020] 116 taxmann.com 415 (Delhi), the Delhi High Court held that Rule 117 of the CGST Rules is directory in nature in so far as it prescribes the time limit for transitioning of credit is concerned and at the same time the Court held that the same would not result in the forfeiture of the rights. In the instant case, the applicant failed to file Form TRAN-1 in absence of sufficient staff and sufficient cause existed for not applying within transitional period. Therefore, the Court relied on the decision of Delhi High Court and directed the department to permit filing of TRAN-1 either electronically or manually.