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Going Beyond!!!November 2019
Hiregange Academy(A Division of Empower Education Foundation®)
- Empowering Knowledge & Employability
Disclaimer: The “Going beyond” is meant for informational purpose only and does not purport to be
advice or opinion, legal or otherwise, whatsoever. The information is not intended to be relied upon as the
sole basis for any decision which may affect you or your business. Before making any decision or taking
any action, you should consult a qualified professional adviser.
Hiregange Academy 1
Hiregange Academy
GST articles
Notifications & circulars
Case law updates
GST orders
Reach us at:Hiregange Academy#1010, 1st floor, 26th main,(Above Corporation Bank)4th ‘T’ Block, Jayanagar,Bangalore 560 041Mob. – [email protected]
2
Indirect Tax - GST
❖ GST on Employee Recoveries.
❖ How to draft reply to SCN and appeals?
❖ Credit eligibility on goods given under incentive
schemes.
❖ Last chance to claim transitional credit – Now or
Never!!!
❖ IGST exemption vis-à-vis pre-import condition.
❖ GST – Another chance for claiming Transitional credit
now.
❖ Notifications, circulars & orders issued in November
2019.
Hiregange Academy
Compendium
Way of rewarding the Tax Compliant:
A small number percentage/ number of tax compliant contribute substantially to both the
income tax as well as GST in India. There is an urgent need to see that they are supported
by specific measures and not only by empty words. Their tribe needs to multiply. Needs
some hard decisions and soft attitude towards them. However, for the errant evader the
need to quickly punish is needed. Time compromises the people as well as the documents.
Some measures could include:
Categorise those filing regular returns or based on increased net contribution as green.
Specific benefits be accorded to them and checking to be only 1% for them. No stopping by
e-way bill squad, audit only once in 3 years limited 3 days each time….
Bring the petroleum products into the GST, available for set off. Around 2-3% ITC would
increase for the tax compliant and force those outside to join to get that advantage. There
may however be an adverse impact in the short term as the present rates on the 5
products are relatively high.
Bring the commercial real estate into GST for registration purposes.
Focus on the tax evader and not on those registered who are filing regular returns.
Do not: attach bank accounts, write to suppliers, collect tax which is based on
interpretation or suppliers default with threats of closure of business or arrest.
Grant refunds for those where files are lost and not found for years on provisional basis.
Have an automated help desk- ( 90% will answer) and also manned by professionals to
answer all procedural queries escalated to them(10%).
E-way bill related seizures only for absence of documents and not some errors in figures/
dates. Automatic extensions where there are some logistic issues known like climate,
inaccessibility, strike… - CA Madhukar N Hiregange
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Can 2020-21 be the watershed year for GST revenues to exceed
Rs. 18 Crores?
Last 2 months the overall collections crossing 1 lakhs crores may have much to do with
the exercise of 9/ 9C as the growth rate has not been too good.
It is possible for the government to improve on 18 Lakhs crores for 20-21 as even today
the claim of threshold exemption and not registering maybe around 30 Lakhs in numbers.
Multiple registration in composition has also seen an alarming increase impacting
collections.[ GSTN may confirm this trend] Similar supplies to the residential construction
sector where ITC is not needed as well as retail sector is also understood to have increased
post 1st April 2019 in either of these categories.
Solutions could be as under:
1. Financial constraints in market today needs to be addressed. Maybe a one time carry
forward of debt without forcing NPA norms this year. 2. B2C focus to be started in earnest
from CBIC using data analysis from the Form 9/ 9C, comparing to the IT retruns. 3.
Selected industries where this is suspected can be analysed and those purchasing more
but not registered identified. Further the practice those who are creating new firms by
splitting the turnover based on genuine PAN nos need to curbed by bringing about
clubbing of clearances as was there in the central excise regime. This needs amendment to
the Act. If possible in budget 2020 itself. 4. Separate teams to identify those not in the net.
Allowing them the ITC as a one time encouragement may bring good results. Raiding those
in the net maybe limited. 5. Rewarding the tax compliant should be visible and practice of
objecting for minor breaches to be avoided till 1) & 2) above well under way. 6.
Comprehensive circular simultaneous to withdrawal of all circulars till date may make
compliance much easier. This could be ensured to be in place latest by March end. 7. A
serious relook at recasting the GST law without too much focus on making laws for law
evaders and recommitting to the fundamental principles of a simple law, easy to comply
could be a longer term objective. 8. The commencement of audit with specific focus on
procurement from unregistered suppliers, excess ITC availment may also yield 5%
increase for 2021 onwards.
- CA Madhukar N Hiregange
GST on Employee Recoveries:
GST has introduced quite a few concepts which are new or unheard by Indian taxpayer.
Few are levy of tax on stock transfer of goods, taxation of gifts distributed to employees
etc. In terms of Section 7 read with schedule I to CGST Act 2017, there are specified
activities which would be subject to GST even though there is no consideration in return
for such activities / supplies. One such activity is supply of goods/ services to related
persons which includes employees and to distinct person which can include
branches/warehouses with separate GSTIN.
After introduction of GST, there were lot of confusion on taxability of perquisites/ gifts to
employees. To clear this, press release dated 10th July 2017 was issued by CBIC. It was
clarified that gift has not been defined in the GST law and in common parlance, gift is
made without consideration and it is voluntary in nature made occasionally.
Accordingly, common facilities such housing, gym etc., would not get taxed. Gifts
exceeding the value of Rs.50,000/- per annum per employee would get taxed in the
hands of employer being supplier of such gift. Even perquisites cannot be levied to tax as
services by an employee to the employer in the course of or in relation to his employment
is outside the scope of GST (neither supply of goods or supply of services) being covered
in schedule III. When there is no recovery of any amounts from
employees, there could not be any GST impact.
GST on supplies:
Services by an employee to the employer in the course of or in relation to his employment
would not be treated as either supply of goods or supply of services in terms of Schedule
III to CGST Act 2017. Therefore, any payments made by an employer to employee in
terms of employment contract should not suffer GST. The issue would arise when there
are supplies which are made to employees outside the terms of employment for which
consideration is received by employer other than in form of employment services. It is
important to note that services by an employee to employer is outside the purview of GST
and not vice versa.
Free common facilities not taxed:
Considering the press release dated 10th July 2017, common facilities provided
commonly to employees without any recover would not be subject to GST as they cannot
be considered as gifts:
1. Telephone / mobile services
2. Internet services
3. Education reimbursement for employees’ children
4. Transport facilities
5. Membership of gym, health club etc.
6. Subscription to journals
7. Canteen facilities
8. Coffee / tea and other beverages during office hours
9. Training facilities
10. Parking services
11. Insurance for self and family
12. Uniform including shoes
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13. Joining bonus
14. Access to furniture and other infrastructure
15. Office tours / trips
The list can continue to cover all such common facilities for which there is no recovery
from employees.
GST when recoveries made:
It may so happen that for some of the facilities provided, employers recover amount from
the employees. Such recoveries could be concessional. For example, Rs.5 recovered from
employee for a meal actually costing Rs.50. Question which arises here is if, Rs.5
recovered is subject to GST or not. Insurance, telephone, transportation and housing
facilities provided at concessional rates could be other examples.
GST law being new in India, there are many issues for which finding actual solution may
not be an easy task. Reference to European VAT laws which has inspired Indian GST law
could give us some idea on interpreting few provisions. The judgment of European Court
of Justice (ECJ) delivered its judgment in Astra Zeneca UK Limited v HMRC (Case
C40/09) could be of relevance here. In this case, the court held that partial salary
sacrifices by employee towards the vouchers issued by employer is consideration giving
rise to VAT. When there is recovery of any amount from employees towards any supplies
(unless exempted), such supplies could be treated as supply by revenue department.
Valuation for payment of GST:
The transaction between employee and employer is treated as related party transaction
and therefore, transaction value would not be applicable for levy of GST. Rule 28 of
CGST Rules 2017 would be applied for valuation of supply when the transaction is
between related parties. According to Rule 28, the value of supply which should be
considered by employer on recoveries from employees should be as below:
a) open market value
b) if open market value not available, value of like kind or quality goods or services
c) if value is not determinable according to a) or b) above, then cost of services +
10% or residual method should be adopted.
Open market value could be adopted which could be value paid by the employer to the
original supplier. Considering earlier example, the value on which GST payable by
employer would be Rs.50 though only Rs.5 being recovered from employees.
Input tax credit:
Unless restricted under Section 17(5) of CGST Act 2017, GST on inward supplies can be
claimed by employer when GST being paid on recoveries. ITC on canteen can be claimed
where it is a statutory requirement. However, restrictions under rate notification to be
considered. Services such as canteen, rent-a-cab can be subject to lower rate of 5% GST
subject to non-availing of credit on inward supplies. It is wise to undertake cost benefit
analysis for the taxpayer before deciding on recovering any amounts.
Consider following example for canteen service where having canteen is statutory
requirement and Rs.5 being recovered from employees:
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If there is no recovery made, then employer’s cost would be Rs.90 as Rs.4.5 charged by
vendor is eligible for credit in this case. Such non recovery could also boost the morale of
employees. Considering, the category of supply and rate of tax, such analysis to be
made.
Notice pay recovery:
Notice pay recovery is very common in entities which is recovered when employee does
not serve in the notice period. Taxation of such amounts is in question from service tax
regime. The major view is that such recovery is towards tolerating the act or a situation
by the employer which was considered as declared service in service tax. In GST law,
such toleration has been specifically stated to be a service in schedule II to CGST Act
2017. It is essential to understand if there is a supply which should normally be a
positive act by the employer.
It is very interesting to note that UK VAT law which is very close to our GST law does not
levy tax on termination of contract subject to condition that the contract originally
contains a clause allowing the parties to terminate early in lieu of compensation for
losses arising from termination. However, levy could get attracted where no such clause
exists in original agreement, and separate agreement reached to terminate. This may not
be applicable in India as our GST law does not provide for such exemption in the law.
Introduction of similar clause in Indian GST law could solve this issue. For the time
being, it would be safe to assume that GST is payable and consider the tax factor in
employment agreement for recovery from employees. Those who are risk seeking could
rely on the order of Commissioner (Appeals) in case of M/s.Gujarat State Fertilizers &
Chemical Ltd (2016) wherein it was held that the cessation of employment should also be
treated as employment service not liable for service tax.
Conclusion:
GST council is taking all necessary measures to simply the law though introduction of
GST was not planned well. Failure of IT infrastructure also added to the injuries of tax
payer. There have been numerous press releases, tweets, circulars to clarify and clear
the confusion. It is time to clarify issues such as taxability of notice period recovery.
There have been few advance rulings as well which are adding to the confusion. In few
rulings, canteen recoveries are held as taxable whereas recoveries towards insurance
amounts held as not liable for GST. Taxpayers and professionals are clueless in such
cases.
- CA Mahadev
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Cost of
Meal
GST by
vendor @
5%
Partial
recovery
amount
GST payable
on
recovery (No
ITC on
inward) @ 5%
Net tax cost
to
employer
(4.5+4.5 – 5)
+ 90
90 4.5 5 4.5 94
How to draft reply to SCN and appeals?
Litigation is all about the convincing the authorities about the compliance of law on facts
of each case. This begins with clear understanding of the facts and clear understanding
of the relevant provisions of the applicable laws. Normally, the most litigation is on
account of possible different interpretations of the law. In other words, the ambiguities in
the provisions of law results into litigation. In some cases, the discretionary powers given
in the law to the revenue authorities also leads to dispute. For interpretation of the
provisions of law, the settled legal precedents play a major role. However, on a given
issue, the legal precedents may be available in favour of the assessee as well as against
the assessee. Sometimes, same issue may be decide differently by different legal forum.
Therefore, the fact of ‘convincing’ the authorities is important in the litigation.
Reading:
Before, starting the reply to any show cause notice or preparing appeals, the show cause
notice (‘SCN’) or in Order in Original or Order in Appeal (‘Orders’) should be read fully,
including the documents relied upon by the authorities. It is very important that the
demand or the values computed by the authorities need to be confirmed for its
correctness by the assessee. This is because, in many cases, there shall be error in this
computation itself.
After reading the SCN or Orders carefully, it is important to pinpoint the non-compliance
alleged in the SCN or concluded in the Orders and the relevant provisions of the Act and
the Rules made thereunder. Further, the basis which has lead to the said allegation or
conclusion should also to be understood clearly. Generally, there should not be any
allegation in the SCN or conclusion in the Orders without any basis.
Thus, there will be a gist of alleged non-compliances of relevant provisions of law and the
actions or inactions of the assessee which has lead to such alleged non-compliances.
The relevance of the legal supports or the legal precedents adduced by the authorities to
the issues on hand should be verified.
There may be a situation where facts in the SCN and Orders is correct, but the
provisions of law applied is incorrect or facts itself is held to be incorrect or even legal
supports or precedents relied upon are distinguishable in the given facts and
circumstances.
Once the alleged contraventions, the relevant provisions, the legal supports and legal
precedents relied thereon in the SCN or the Orders are understood, the counter
arguments are to be framed up.
Facts of the Case:
For replying any show cause notice or for filing any appeal, it is important to understand
the facts of the case very clearly. The facts to be stated in the reply or appeal in a crisp
and clear manner. All the relevant facts pertaining to issue on hand should be stated-
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chronologically. While stating the facts the reference to the provisions of law or case laws
are to be avoided. It should not also have any conclusion on the compliance of law.
It should be a pure statement of facts, bonafide action of the assessee. The statement of
fact should clearly bring out sequence of actions which have lead to issue of show cause
notice or appeal. The statement of facts should not be too long but to be focused on the
given issues so that after reading, the authorities should know the reasons which has
lead to dispute.
The facts should fully cover the basis on which allegations are made in the SCN or
conclusions arrived in the Orders.
Grounds of Appeal:
In case of appeal, the grounds of appeal are to be submitted. For having an
understanding at glance, it is better if grounds with brief in one or two sentences are
mentioned in this part. The detailed submission is to be in the next part. In the grounds
of appeal part, all the grounds whether it is on question of law or on question of facts are
to be stated including on interest and penalty, if any. It should be noted that no new
grounds on fact can be raised at appeal level unless the appellate authority allows the
same. It is also to be seen whether the conclusions in the order are within the scope of
the SCN.
Detailed Submission:
In the detailed submissions, for each ground, under the respective grounds of appeals,
the relevant provision of law is to be discussed first. What the assessee is expected to do
under the relevant law is to be clearly brought out. In many cases, to interpret the
provisions of law, the legal precedents and legal supports like clarifications issued
through Circulars, FAQs would be available. Even the finance minister’s speech while
passing the bill, preambles may be useful to interpret the intention of the law makers.
After the discussion on the requirements of legal compliance, the facts of the assessee in
compliance of the relevant law is to be explained. All the documents in support of the
facts need to be referred to and the same shall be annexed as attachment. There should
not be anything to be left out which is helpful in establishing the compliance. Many
times, the technical literature, opinion from experts, trade parlance shall add to the
submissions. The documentary evidences, samples, pictures may also be useful to
substantiate the claim.
To support the claim of compliance, the decided case laws are very useful. Before
referring to any case law, it is important read the case law completely. Based on the
synopsis of the case law, the reliance should not be placed. The points to be considered
while relying on particular case law are (i) the legal forum (ii) similar facts and
circumstances (iii) current status of the case and (iv) status of the provision of law during
relevant period in the case law. It is also important to know the case laws against, so
that proper argument can be prepared to distinguish the same. The binding nature of
the caselaw is also to be considered before relying upon. The relevant portion of the
reasoning and conclusions in the case laws must be reproduced and copy of such case
laws are to be attached as exhibits. It is important that the discussion under each
ground is not overlapping and it gives the reader a direction towards conclusion with
clarity. At the end of the submission for each ground, conclusion should be given.
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Prayer:
After the detailed submissions for each ground, prayer seeking the relevant relief should
be made.
General:
The language should be simple and unambiguous. It should not be too lengthy
submission, so that focus should not get lost. Number of case laws relied upon also
should not be too much. All the documents relied upon must be annexed as exhibits. In
case of delay in replying to SCN or filing of appeals, condonation of delay is to be
submitted stating appropriate reason for delay and prayer for condonation. The other
formalities such as indexing, page numbering, line space, paper size in making the paper
book is to be strictly adhered to.
- CA Vasant Bhat
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Credit eligibility on goods given under incentive schemes.
Introduction:
One of the major expenditures incurred in some of the industries is business promotion.
This being a typical and a critical expenditure for many industries (i.e. even a small
trader in such industry would have to incur such expense), innovation is the stress
whereby business promotion schemes could take form of free goods being given or
reward points being given or free trips being offered, etc. In the recent ruling given by the
Karnataka Authority for Advance Ruling (AAR) in the case of Surfa Coats (India) Private
Limited dated 12.09.2019 [2019 (10) TMI 568] it was ruled that free goods and services
would not be eligible for input tax credit (ITC), being restricted u/s 17(5) of the CGST Act,
2017. Let us have a look at the said ruling and analyse in the light of the provisions and
the business practices.
Facts:
1. The applicant is into the business of manufacturing decorative paints meant for
interiors as well as on exterior surface. Applicant frames many incentive schemes like
Painters Schemes, Dealers Incentive Schemes, Gold Schemes, Foreign and Local Trip
Schemes etc. to survive in the existing market conditions in the industry and which
motivate dealers to lift their products.
2. The incentives are given subject to fulfillment of terms laid down in each such scheme.
The incentive once computed is mostly given in kind. The applicant purchases TVs,
refrigerators, washing machines, mixers, wet grinders, watches, mobiles, gold coins, bed
sheets etc., for distribution to painters and dealers in connection with the above said
incentive schemes. Also, at times applicant offers foreign and local trips as incentives, for
which they procure various tax suffered services. Further in the Gold scheme, the
applicant gives gold to dealers once the actual sales are achieved by the dealers in terms
of targets fixed.
Applicant’s submission and query:
1. Such painter schemes are given by most of the paint companies to market their
products and make their presence in the industry and the gold incentive scheme is given
to the dealers based on the achievement of target sales which is moreover for sales
promotion.
2. Therefore applicant states that these items are used in the course of furtherance of
business only and not for sale and thus desires to have a ruling whether input tax credit
(hereinafter referred to as ‘ITC’) is admissible on these incentive item bought and given
in terms of schemes to promote company’s product only.
Authority’s observation and analysis:
3. The goods and services so procured and distributed as incentives or gifts are disposed
without any consideration from dealers or painters and hence do not qualify to be a
‘supply’ in terms of Section 7 of the CGST Act,2017 (hereinafter referred to as ‘Act’).
Further no GST is being paid on disposal of the said gift items.
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4. Moreover, in terms of section 17(5) (h) of the Act, ITC is not allowed on any goods
disposed of by way of free samples or gifts whether or not in the course or furtherance
of business.
5. The free travel services provided are also without any consideration and hence do not
qualify to be a “supply” in terms of section 7 of the CGST Act 2017 and Schedule 1 to the
Act.
6. It is further clarified in para (A)(ii) of circular No.92/11/2019-GST dated 07.03.2019,
that “input tax credit shall not be available to the supplier on the inputs, input services
and capital goods to the extent they are used in relation to the gifts or free samples
distributed without any consideration”.
Ruling:
7. In the view of above facts and observations of Authority, it was ruled that the
applicant is not eligible to avail ITC on the inward supplies of goods and services
which are attributable to the incentives provided in the form of gifts of goods and
services to the painters and dealers and other persons under the CGST/ SGST / IGST
Act.
Comments:
The transaction between the applicant and its dealers is on principal to principal basis
wherein the goods are sold to the dealers on an invoice, which are then sold by the dealer
to its customers. In such a case, it is to be understood that any incentive or discount
given would not partake the character of a separate supply or service as was always
being held under the earlier laws, like in the case of Commissioner v. AIA Engineering
Ltd. - 2016 (41) S.T.R. J262 (S.C.), Commissioner Of Service Tax, Mumbai-I Versus Sai
Service Station Ltd. 2014 (35) S.T.R. 625 (Tri. - Mumbai) and a host of other decisions.
Further, these incentives, discounts can be given either in monetary terms or in kind. In
the instant case, the following are the incentives offered:
a. Free gifts being goods,
b. Gold coin given as per the terms of the agreement between the dealer and the
applicant on reaching the target volumes, and
c. Free trips being given, which are in the nature of free services.
The relevant provision under section 17(5) ibid restricting credit reads as below: ……
input tax credit shall not be available in respect of the following, namely:-…….(h)
goods lost, stolen, destroyed, written off or disposed of by way of gift or free samples;
From the above, it is clear that for the credit to be restricted
a. There should be a gift given, and
b. Such gift should be that of goods.
Another aspect to be noted is that such goods are to be DISPOSED OF by way of gifts.
What is the relevance of use the phrase ‘disposed of’? The said phrase means getting rid
of something that you no longer want or need. Can the said interpretation be taken
whereby, unless anything useless is gifted (i.e. something no longer required), the
restriction under section 17(5) ibid will not apply? Further, can it be said that the so-
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called free goods are given in place of a monetary discount, in which case there can be
no credit restriction as these discounts are not for any separate activity or given free, but
are in relation to the supply already made by the Applicant (the original supply of goods
by the Applicant to the dealer) which has suffered tax?
Another aspect to be considered is whether giving the goods free can be treated to be a
barter transaction? No, for the reason that the said goods are not given for anything in
return from the recipient, but it is in continuation of the sale transaction already made
by the Applicant to the dealer. Hence, may not satisfy to be a barter also. These are
extreme views which will have to be judicially tested.
Coming to the present case, following can be noted to enable credit w.r.t. the incentives
given:
a. Gold coins: Given as part of the agreement which cannot be considered as a gift as
there is an obligation on part of the Applicant to give such gold coins on fulfilment of the
conditions stated. In this regard, important to note the press release dated 10.07.2017
wherein it was mentioned
“Gift has not been defined in the GST law. In common parlance, gift is made without
consideration, is voluntary in nature and is made occasionally. It cannot be demanded
as a matter of right by the employee and the employee cannot move a court of law for
obtaining a gift”
On this count it can be stated that the credit relating to the gold coins given, which is an
obligation on the Applicant, would be eligible as it does not partake the nature of a gift.
b. Other free goods: If it cannot be shown that the other free goods given are an
obligation, credit may not be eligible.
c. Free trips: These are not goods and the restriction under section 17(5) ibid being only
for the goods, credit will be eligible on the count that the said services areused in the
course or furtherance of business. ‘Business’ is a very wide term as was held in a host of
decisions under the earlier laws for the CENVAT eligibility before 01.04.2011. The free
trips given could fall under the ambit of usage for business as it leads to increase in
sales and thereby credit being eligible. Further the circular referred to in the ruling does
not mention credit will not be available on free goods and services but only mentions that
the ITC of the goods and services used in relation to the gifts i.e. goods being given as
gifts, as contained in section 17(5) ibid, would not be eligible. Thereby, reliance on the
said circular is also not correct.
“input tax credit shall not be available to the supplier on the inputs, input services
and capital goods to the extent they are used in relation to the gifts or free samples
distributed without any consideration”
Further, as far as the mention in the ruling that since the free goods are given without
consideration and there is no supply, credit is not eligible, it can be said that when the
inputs and input services satisfy the condition of being used for business (being in
relation to taxable supplies), it does not matter whether their transfer per-se is a supply
or not.
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Assuming that the mention in the ruling regarding liability under Schedule I to the Act is
correct, in such case can the Applicant consider the free goods procured directly as an
expense without taking it into stock whereby it would not be a business asset and
thereby no liability to pay tax?
GST being a new law, there are a lot of areas where the trade and industry have moved
ahead by taking conservative views. Further, the advance rulings give confirmation to
such views (which in the view of the paper writers should not be taken too seriously to
take business decisions). However, it is advised in case of huge stakes that before it is
too late, a professional can be consulted to identify possible value additions considering
the risks involved to take informed decisions
- CA Shilpi Jain
- Nagasena. A
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Last chance to claim transitional credit – Now or Never!!!
India moved into the new regime of the GST taxation, which left the taxpayers with the
stock on which the existing tax was paid (central excise and VAT) and also with the
balance of the tax credit of the existing law and may other challenges considering this
Chapter XX of the Central Goods and Service Tax Act, 2017 has transitional provisions
from section 139 to 142.
In order to eliminate double taxation at the time of transition into GST, all taxpayers
were given a facility to carry forward the unutilized input credits under pre-GST regime
under section 140(1) by filing a online form named ‘TRAN-1’ and also allow the credit of
taxes paid on the stock as on 30th June 2017 as GST credit under section 140(3) of
CGST Act r/w Rule 117 of CGST rules, 2017 as amended inter alia requires the
taxpayers to file Form GST TRAN-1 & GST TRAN-2 electronically. Initially, the due date
to file Form TRAN-1 was set to be 27.12.2017. However, many taxpayers could not
complete the filing of Form GST TRAN-1 within the said due date account of IT-related
glitches and also due to lack of knowledge. As a result, a large number of such Form
GST TRAN-1s were stuck in the system. At this juncture, it is to be noted that section
140 does not provide any time limit for the transition benefit but will only give powers to
prescribe the manner and hence Rule 117 prescribing the time limit would be ultra vires
the act.
Numerous petitions have been filed across the country and the Hon’ble High courts have
time & again directed the Government either to reopen the portal or to allow the manual
filing of the forms. Some courts have suggested the Government to set up a redressal
committee.
In light of these developments and acknowledging the genuine problems faced by the
taxpayers, the Government has provided a window enabling the taxpayers to file the
Form Tran-1 till 31.03.2019 and which is now extended till 31.12.2019. It should be
noted that this facility is available only to the persons who have attempted to file
the FORM GST TRAN-1 within the initial due date i.e., 27.12.2017 but could not
file the same due to technical glitches in the portal and further has digital
evidence to prove the same (category-1). Hence, taxpayers who can substantiate
electronic audit trail and have digital evidence like screenshots, help desk
correspondence, etc., can take benefit of this date extension and avail the earlier missed
out transitional credits now. For this, an application shall be made to the Nodal
officer of the IT redressal committee, not beyond 31.12.2019.
However, the aforesaid relief is not applicable to those taxpayers who:
• have made errors or mistakes in filing and TRAN-1 could not be revised (category-2)
• attempted filing TRAN-1 online within the due date but could not possess digital
evidence like screenshots, help desk correspondence, etc. (category-3)
• did not file TRAN-1 until now due to various reasons such as lack of awareness and
ignorance, lack of IT infrastructure, inexperience of accountants in filing such complex
forms, etc. (category-4)
GST
Hiregange Academy 15
The category 2, 3 & 4 of the taxpayers do not have any option but to approach the High
courts. Further, in case such taxpayers are not allowed to carry forward unutilized
credits via filing of TRAN-1, then they could apply for refund in terms of Section 142(3) of
CGST Act as they have a vested right towards such credits.
In recent times, there are a series of decisions delivered by the various High courts.
Noted decisions sorted category wise:
Applicable for category 2
• In the case of Blue Bird Pure Pvt. Ltd. Vs Union of India & Ors. (Delhi High Court),
it was held that transitional credit cannot be denied due to inadvertent error and
directed to allow the rectification of Form Tran-1.
• In the case of Jakap Metind Pvt. Ltd. vs. Union of India (Gujarat High Court), HC
directs the Revenue to either open the online portal so as to enable the assessee to
again file the rectified FORM GST TRAN-1 electronically or accept the manually filed
FORM GST TRAN-1 with corrections.
• While the assessee had filed the form, but on account of not properly understanding
the nature of columns provided in form, due to inadvertent error, mentioned the
details of credit amount in the wrong column;
• Referring to Delhi HC decisions in Blue Bird Pure Pvt. Ltd. & Bhargava Motors, it was
held that Revenue has no legal authority to retain the amount of credit to which the
petitioner is duly entitled and retention of the same is violative of Article 265 of the
Constitution of India” while asserting further that non-grant of the credit “is bad in
law”.
Applicable for category 2, 3 & 4
• In Adfert Technologies Pvt. Ltd. Vs Union of India & Ors. (Punjab & Haryana High
Court) dealt with the two types of cases namely
✓ Taxpayers did/could not file Tran-1 by the due date and have no evidence of an
attempt to load Tran-1
✓ Taxpayers loaded Tran-1 by the due date but there were mistakes and wanted
to revise.
• And it was held that he Introduction of Rule 117(1A) & Rule 120A and absence of any
time period prescribed under Section 140 of the Act indicate that there is no intention
of the Government to deny carry forward of unutilized credit of duty/tax already paid
on the ground of time limit.
• GST is an electronic-based tax regime and most of the people of India are not well
conversant with electronic mechanisms.
• Unutilized credit arising on account of duty/tax paid under erstwhile Acts is vested
right which cannot be taken away on procedural or technical grounds.
• There were a number of steps and columns in TRAN-1 forms thus possibility of
mistake cannot be ruled out.
• The revenue authorities were having a complete record of already registered persons
and at present, they are free to verify facts and figures of any Petitioner thus in spite of
being aware of complete facts and figures, the revenue department cannot deprive
petitioners from their valuable right of credit
• It had directed Revenue to permit filing of TRAN-1 or revision of incorrect TRAN-
1 either electronically or manually on or before 30.11.2019.
GST
Hiregange Academy 16
It was also held that Revenue is at liberty to verify the genuineness of the claim but
cannot deny to carry forward legitimate claim of CENVAT ITC on ground of non-filing of
TRAN-1 by 27.12.2017.
Applicable for category 3 & 4
• In the case of Siddharth Enterprises Vs NODAL Officer (Gujarat High Court) it was
held that The right to carry forward credit is a right or privilege, acquired and accrued
under the repealed Central Excise Act, 1944 (1 of 1944) and it has been saved under
Section 174(2)(c) of the CGST Act, 2017 and, therefore, it cannot be allowed to lapse
under Rule 117 of the CGST, 2017, for failure to file declaration form GST Tran-1
within the due date, i. e. 27. 12. 2017;
• The time limit prescribed under Rule 117 to allow the availment of the ITC with
respect to the purchase of goods and services made in the pre-GST regime and post-
GST regime is arbitrary, irrational and unreasonable and, therefore, it is violative of
Article 14 of the Constitution;
• The due date contemplated under Rule 117 of the CGST Rules to claim the
transitional credit is procedural in nature and thus merely directory and not a
mandatory provision;
• By not allowing the right to carry forward the CENVAT credit for not being able to file
the form GST TRAN-1 within the due date may severely dent the writ-applicants
working capital and may diminish their ability to continue with the business and such
action violates the mandate of Article 19(1)(g) of the Constitution;
• The liability to pay GST on sale of stock carried forward from the previous tax regime
without corresponding input tax credit would lead to double taxation on the same
subject matter and is, therefore, arbitrary and irrational;
• The phrase “technical difficulties on the common portal” should be given a liberal
interpretation because it is a settled principle of law that an interpretation unduly
restricting the scope of a beneficial provision should be avoided so that it may not take
away with one hand what the policy gives with the other;
• In the case of Tara Exports Vs Union of India (Madras High Court) it was held that
the due date contemplated under the laws to claim the transitional credit is
procedural in nature. In view of the GST regime and the IT platform being new, it may
not be justifiable to expect the users to back up digital evidence. Even under the old
taxation laws, it is a settled legal position that substantive input credits cannot be
denied or altered on account of procedural grounds.
• In the case of Tyre Plaza Vs Union of India & Ors. (Delhi High Court), it was held
that there appear to be technical errors or technical glitches of various kinds in the
GST system, which is still in the ‘trial and error’ phase. If it was not able to even
connect with the server, the fact of a failed attempt at filing a return may not even be
registered on the system. Hence, directed to allow the filing of form Tran-1.
Suggested course of action – category wise:
Category 1: Taxpayers who have attempted to file but could not due to technical glitches
in the common portal and possess digital evidence to corroborate the same
1. Application to be given to respective Nodal officer of the IT redressal committee of the
respective area on or before 31.12.2019.
GST
Hiregange Academy 17
2. Application should include facts and information of the case, details of input to be
carried forward as TRAN-1 credit. It is very important to note that due professional care
needs to be taken in making such an application.
3. The corroborative digital evidence like screenshots, helpdesk correspondence, etc
should be attached in order to establish an electronic audit trail for the department.
Category 2: Taxpayers who have made errors or mistakes in filing and TRAN-1
could not be revised
1. Application to be given to respective Nodal officer of the IT redressal committee of
respective area (preferably before 30.11.2019 as per the latest Landmark Judgement
of Adfert Technologies discussed above)
2. Application should include facts and information of the case, details of previously
filed TRAN-1 and revised or correct details of input to be carried forward as TRAN-1
credit.
3. The corroborative digital evidence of attempt of revision like screenshots, helpdesk
correspondence, etc if any could be attached in order to establish an electronic audit
trail for the department.
4. If the application is rejected or not acted in a reasonable time, file a writ petition
before the Jurisdictional HC for necessary directions
Category 3: Taxpayers who have attempted to file but could not due to technical
glitches in the common portal and does not possess digital evidence to corroborate
the same
1. Application to be given to respective Nodal officer of the IT redressal committee of
respective area
2. Application should include facts and information of the case and the details of the
attempt.
3. The Nodal offer can get the report from the IT to check if the attempt was made.
4. If the application is rejected or not acted in a reasonable time, file a writ petition
before the Jurisdictional HC for necessary directions
Category 4: Taxpayers who did not file TRAN-1 until now
1. Application to be given to respective Nodal officer of the IT redressal committee of
respective area (preferably before 30.11.2019 as per the latest Landmark Judgement
of Adfert Technologies discussed above)
2. Application should include facts and information of the case, details of input to be
carried forward as TRAN-1credit. It is very critical that all the facts and the grounds
needs to be taken at this stage.
3. If the application is rejected or not acted in a reasonable time, file a writ petition
before the Jurisdictional HC for necessary directions
Action points require in general :
1. First to make the assessment of the what all transition benefit the company is eligible
2. What has been missed
3. Quantification of the missed benefit
4. Documentation for the same
5. Decide on the approach one needs to take
6. Professional representation on merits before the appropriate authority
GST
Hiregange Academy 18
Link for reference of List of Nodal officer for application - https://cbic-gst.gov.in/cgst-
nodal-officer.html
FAQ’s:
Q1. I had made several attempts to file Tran-1 before 27.12.2017 but could not file due
to unknown errors and system glitches in the GST portal. I had also made several
assistance requests to the GST helpdesk. Can I file the TRAN- 1 again now? If yes when
and how?
Ans – Yes, TRAN-1 can be filed now. Application for the same needs to be given to the
Nodal officer on or before 31.12.2019 with evidence of correspondence of helpdesk. For
further information - Please follow the steps given for category-1 taxpayers. Hiregange &
Associates Chartered Accountants
Q2. I had filed TRAN-1 but had made some errors in filing due to which there remains
some missed out credits. I had attempted to revise TRAN-1 but could not do so due to
system limitations as the porta would not allow for any rectification. Is rectification
possible now?
Ans – In reliance to the latest judgments being in favor of the assessee, it is suggested to
apply for the same. An application needs to be given to the Nodal officer at the earliest;
preferably before 30.11.2019 with details of the previous form and revised input details.
For further information - Please follow the steps given for category-2 taxpayers.
Q3. I did not file TRAN-1 form due to a lack of appropriate knowledge and no time for
collating information due to the continuous pressure of GST implementation and its
stringent due dates of monthly return filing. Can I file the TRAN-1 now and claim
unutilized CENVAT credits?
Ans - In reliance on the latest judgments being in favor of the assessee, it is suggested to
apply for the same. An application needs to be given to the Nodal officer at the earliest;
preferably before 30.11.2019 with appropriate details of CENVAT credits to be carried
forward. For further information - Please follow the steps given for category-4 taxpayers.
Q4. What if there is no appropriate response from the Nodal officer or my application is
rejected? Do I have any other solution or course of action?
Ans- If the application is rejected or not acted in a reasonable time, file a writ petition
before the Jurisdictional High Court for necessary directions. In view of numerous
favorable HC judgments on the subject, there is a high possibility that HC may allow
filing TRAN-1 electronically or manually since inputs tax credit is a vested legitimate
right of the assessee.
CA Sudhir V. S
& CA Mannu Kashliwal
GST
Hiregange Academy 19
IGST exemption vis-à-vis pre-import condition
Advance Authorisation (AA), is one of the schemes under Foreign Trade Policy, 2015-20
(hereinafter referred to as the ‘FTP’) which allows the manufacturer exporter or merchant
exporter to import inputs without payment of customs duties in terms of chapter 4 of
FTP read with Notification No.18/2015 Cus dated 01.04.2015 as amended. The AA
holder has to fulfill prescribed export obligation(EO) corresponding to the duty free
imports made. The duty exemption claimed needs to be paid back along with interest @
15% to the extent of unfulfilled EO. In case of the exporters qua AA holders having
continuous export business, there is practice prevailing to export the goods well before
the first import made against the advance authorization. Such export products are
actually manufactured using the existing stock. The cycle of import and export goes on.
One would not be maintaining the one to one correlation of the imports vis-à-vis
corresponding export orders. In fact, the advance authorization scheme itself provides for
the export in anticipation of benefits under this scheme.
Prior to introduction of the GST, the exemption was available for all types of customs
duties including CVD (Additional customs duty popularly known as countervailing duty)
and SAD (Special Additional duty or countervailing duty for sales tax). The notification
expressly permitted the duty-free imports even after fulfillment of the export obligation.
With the introduction of GST (w.e.f. 01.07.2017), the levies of the CVD & SAD are
subsumed and IGST is being levied on imports. However, the earlier exemption of CVD &
SAD against the advance authorization was not extended to IGST in the initial days of
GST, forcing the exporters to pay IGST at the time of import and claim refund thereafter.
This discontinuation of the exemption has caused working capital troubles to the
exporters as there would be considerable time gap between payment of IGST at the time
of import and receiving refund later from the Government.
Understanding the aforesaid difficulties, Government has issued Notification
No.79/2017-Cus., dated 13.10.2017 restoring the earlier position i.e. exempting the
IGST against the advance authorization. The said exemption was inter alia subjected to
the ‘Pre-import’ condition. The meaning of the said phrase was neither defined in the
FTP policy nor in the notification.
Not being completely aware of the newly imposed ‘pre-import’ condition and also its
meaning & scope, the exporters qua AA holders just continued their earlier practice of
making exports using old stock and importing the duty-free goods later. The customs
officers also allowed the same and did not raise any objection.
The Government vide Notification No. 01/2019-Cus dated 10.01.2019 has omitted the
‘pre-import condition’. It is not clear from this notification, whether this amendment is
prospective or retrospective thereby retaining the ambiguity of the effect of ‘pre-import’
condition for IGST exemption during the intervening period i.e. 13.10.2017 to
09.01.2019.
GST
Hiregange Academy 20
According to the Customs department “pre-import condition” would mean that goods
have to be imported first and then the final products manufactured from such imported
goods and exported, and only when it was established that goods imported against a
particular Authorisation were used in relation to manufacture of finished goods exported
for fulfillment of Export Obligation of that particular Authorisation, that the “pre-import
condition” was satisfied. It is learnt that DRI officers have been denying the IGST
exemption during the intervening period i.e. 13.10.2017 to 09.01.2019 for the goods
imported subsequent to the exports.
Petitions were filed before various High courts challenging the ‘pre-import’ condition and
the interpretation adopted by the DRI as stated supra. While the Madras HC in the case
of Vedanta Limited v. UOI 2018 (19) G.S.T.L. 637 (Mad.) upheld the said condition and
department’s stand, the Hon’ble HC of Gujarat in case of Maxim Tubes Company Pvt Ltd.
v. UOI 2019 (2) TMI 1445 has struck down the ‘pre-import’ condition. The revenue
department has appealed to the Hon’ble Supreme court which has stayed the above
decision and final decision is pending as of now.
As the decision is stayed by the Hon’ble SC & normal period of limitation of 2 years for
raising customs duty demands is coming nearer (For October 2017, it is already over),
the customs department has speeded up their investigation and has started raising the
demands after denying the IGST exemption during the intervening period 13.10.2017 to
09.01.2019 as stated supra.
In view of the above, the available courses of action are as follows:
✓ Contest the demands raised, if any, without payment of any IGST now. If the matter is
decided in favour of the trade, cases would be closed without any cost. If the matter gets
decided against the trade, the IGST along with interest may have to be paid.
✓ Pay IGST under protest (using TR-6 Challan) and contest the matter before the
appellate forums/courts to its logical end. The amount paid using Tr-6 challan would not
be available as ITC as TR-6 challan would not be a proper document for availment of ITC
as per Rule 36 of the CGST Rules, 2017. If the matter is decided in favour of the trade
the amount paid would be refunded. Otherwise, the interest @15% shall be paid from the
import date till the payment of IGST. Under this option, the interest meter would stop
once the IGST is paid.
✓ Pay IGST along with interest (through re-assessment order from port authorities) and
take ITC of IGST paid immediately and contest the matter till its logical end. If the matter
is decided in favour of the trade the interest paid would be refunded. Otherwise, it
becomes the cost. Under this option, even if the case is lost, interest paid would only be a
cost as IGST paid is available as ITC.
In the authors’ view, the ‘pre-import’ condition may not stand in the judicial review and
hopefully the Hon’ble SC will uphold the decision of Hon’ble HC of Gujarat in the case of
Maxim Tubes (Supra) and strike down the ‘pre-import’ condition.
CA Venkat PrasadCA Hemanth Kumar
GST
Hiregange Academy 21
GST – Another chance for claiming Transitional credit now
GST laws contains Transitional provisions inter alia Section 140 of CGST Act, 2017
(similar provision in State GST laws) enables the taxpayer to carry forward the unutilized
input credit under pre-GST regime and allow the credit of taxes paid on the stock as on
30.06.2017 as GST credit. For this, Rule 117 of CGST rules, 2017 as amended inter alia
requires the taxpayers to file Form GST TRAN-1 electronically.
This was to ensure smooth transition from old laws (Central Excise, service tax, VAT)
into GST, avoid the double taxation by way of cascading of taxes. The philosophy was
that since GST rate was calculated to consider the new tax rate and the tax credits under
the earlier regime which needed also to be transited.
The plain reading of the provisions makes it clear that the provisions are designed with
the stated objective of avoiding double taxation and ensuring the smooth transition.
However, practically the aforesaid purpose & objective was not achieved specifically the
filing of Form GST Tran-01.
Various petitions had/are been/ being filed across the country and the Hon’ble High
Courts have time & again directed the Government either to reopen the portal or to allow
the manual filing of the forms. Some courts have suggested the Government to set up a
redressal committee.
In light of these developments and acknowledging the genuine problems faced by the
Taxpayers, the Government had provided a window enabling the taxpayers to file the
Form Tran-1 till 31.03.2019 and which was now extended till 31.12.2019. This facility is
available only to the persons who have digital evidence to prove the technical glitches
while filing their Form GST Tran-1. Hence, taxpayers who have digital evidence like
screenshots, help desk correspondence, etc., can take benefit of this date extension and
avail the earlier missed out Transitional credit now. For this, an application shall be
made to the Nodal officer of the IT redressal committee.
However, the Government has not given the opportunity to the taxpayers who could not
file form Tran-01 for various other reasons such as:
• Attempted filing online but did not take the digital evidence like screenshots, help
desk correspondence, etc as they/ their consultants were not tax savvy and the
awareness of the massive implication on a procedure not followed was not known.
• Unawareness about the due date [ which changed frequently]
• Mandatory e-filing system being new or Lack of computer system in place.
• Mistakes committed while filing online.
• Ignorance with the hope that due date would be extended (which is very frequent in
GST) etc.,
All these categories of the taxpayers who lost out on carrying forward the just ITC do not
have any option but to approach the High courts. In recent times, the series of decisions
are delivered by the various High courts. Noted decisions are:
GST
Hiregange Academy 22
❑ In Adfert Technologies Pvt Ltd v. UOI 2019-TIOL-2519-HC-P&H-GST dealt with the
two types of cases namely
➢ Taxpayers did/could not file Tran-1 by the due date and have no evidence of an
attempt to load Tran-1
➢ Taxpayers loaded Tran-1 by the due date but there were mistakes and wanted
to revise.
And it was held that
✓ The Introduction of Rule 117(1A) & Rule 120A and absence of any time period
prescribed under Section 140 of the Act indicate that there is no intention of
the Government to deny carry forward of unutilized credit of duty/tax already
paid on the ground of time limit.
✓ GST is an electronic-based tax regime and most of the people of India are not
well conversant with electronic mechanisms.
✓ Unutilized credit arising on account of duty/tax paid under erstwhile Acts is
vested right which cannot be taken away on procedural or technical grounds.
✓ There were a number of steps and columns in TRAN-1 forms thus possibility of
mistake cannot be ruled out.
✓ The revenue authorities were having a complete record of already registered
persons and at present, they are free to verify facts and figures of any Petitioner
thus in spite of being aware of complete facts and figures, the revenue
department cannot deprive petitioners from their valuable right of credit.
❑ In the case of Siddharth Enterprises Vs The Nodal Officer 2019-TIOL-2068-HC-
AHMGST it was held that
✓ The right to carry forward credit is a right or privilege, acquired and accrued
under the repealed Central Excise Act, 1944 (1 of 1944) and it has been saved
under Section 174(2)(c) of the CGST Act, 2017 and, therefore, it cannot be
allowed to lapse under Rule 117 of the CGST, 2017, for failure to file
declaration form GST Tran-1 within the due date, i. e. 27. 12. 2017;
✓ The time limit prescribed under Rule 117 to allow the availment of the ITC with
respect to the purchase of goods and services made in the pre-GST regime and
post-GST regime is arbitrary, irrational and unreasonable and, therefore, it is
violative of Article 14 of the Constitution;
✓ The due date contemplated under Rule 117 of the CGST Rules to claim the
transitional credit is procedural in nature and thus merely directory and not a
mandatory provision;
✓ By not allowing the right to carry forward the CENVAT credit for not being able
to file the form GST TRAN-1 within the due date may severely dent the writ
applicants working capital and may diminish their ability to continue with the
Hiregange & Associates Chartered Accountants business and such action
violates the mandate of Article 19(1)(g) of the Constitution;
✓ The liability to pay GST on sale of stock carried forward from the previous tax
regime without corresponding input tax credit would lead to double taxation on
the same subject matter and is, therefore, arbitrary and irrational;
✓ The phrase “technical difficulties on the common portal” should be given a
liberal interpretation because it is a settled principle of law that an
interpretation unduly restricting the scope of a beneficial provision should be
avoided so that it may not take away with one hand what the policy gives with
the other;
GST
Hiregange Academy 23
❑ In the case of Tara Exports v. Union of India — 2019 (20) G.S.T.L. 321
(Mad.) it was held that the due date contemplated under the laws to claim the
transitional credit is procedural in nature. In view of the GST regime and the IT
platform being new, it may not be justifiable to expect the users to back up
digital evidence. Even under the old taxation laws, it is a settled legal position
that substantive input credits cannot be denied or altered on account of
procedural grounds.
❑ In the case of Uninav Developers Pvt. Ltd. v. UOI 2019-TIOL-1661-HC-DEL-
GST, it was held that
✓ The entire GST system is still in a trial and error phase and it will be too
much of a burden to place on the Assessees to expect them to comply
with the requirement of law where they are unable to even connect with
the system on account of network failures or other failures.
✓ The IT Grievance Redressal Committee (ITGRC) to review the policy it has
adopted in such cases and acknowledge instances of the petitioners are
not able to link with the portal and, therefore, the fact of technical glitch
is not able to be accounted for in the system.
✓ Directs the respondents to either open the portal to enable the petitioner
to again file the TRAN-1 form electronically, failing which they will accept
the manually typed TRAN-1 form
❑ In the case of Tyre Plaza v. UOI 2019-TIOL-1902-HC-DEL-GST, it was held
that there appear to be technical errors or technical glitches of various kinds in
the GST system, which is still in the ‘trial and error’ phase. If it was not able to
even connect with the server, the fact of a failed attempt at filing a return may
not even be registered on the system. Hence, directed to allow the filing of form
Tran-1.
❑ In the case of Blue Bird Pure Private Limited v. Union of India) = 2019-
TIOL-1564-HCDEL-GST it was held that transitional credit cannot be denied
due to inadvertent error and directed to allow the rectification of Form Tran-1.
In view of the unvarying series of judicial decisions, the taxpayers who have
missed claiming transitional credits initially can now claim the same. The
suggested course of action is as under:
✓ Apply to the Nodal officer on or before 31.12.2019 for enabling the filing
of Form GST Tran-1 online.
✓ If the application is rejected or not acted in a reasonable time, file a writ petition
before the Jurisdictional HC for necessary directions.
CA Madhukar N Hiregange
CA Venkata Prasad
GST
Hiregange Academy 24
❑ In the case of Tara Exports v. Union of India — 2019 (20) G.S.T.L. 321
(Mad.) it was held that the due date contemplated under the laws to claim the
transitional credit is procedural in nature. In view of the GST regime and the IT
platform being new, it may not be justifiable to expect the users to back up
digital evidence. Even under the old taxation laws, it is a settled legal position
that substantive input credits cannot be denied or altered on account of
procedural grounds.
❑ In the case of Uninav Developers Pvt. Ltd. v. UOI 2019-TIOL-1661-HC-DEL-
GST, it was held that
✓ The entire GST system is still in a trial and error phase and it will be too
much of a burden to place on the assessees to expect them to comply
with the requirement of law where they are unable to even connect with
the system on account of network failures or other failures.
✓ The IT Grievance Redressal Committee (ITGRC) to review the policy it has
adopted in such cases and acknowledge instances of the petitioners are
not able to link with the portal and, therefore, the fact of technical glitch
is not able to be accounted for in the system.
✓ Directs the respondents to either open the portal to enable the petitioner
to again file the TRAN-1 form electronically, failing which they will accept
the manually typed TRAN-1 form
❑ In the case of Tyre Plaza v. UOI 2019-TIOL-1902-HC-DEL-GST, it was held
that there appear to be technical errors or technical glitches of various kinds in
the GST system, which is still in the ‘trial and error’ phase. If it was not able to
even connect with the server, the fact of a failed attempt at filing a return may
not even be registered on the system. Hence, directed to allow the filing of form
Tran-1.
❑ In the case of Blue Bird Pure Private Limited v. Union of India) = 2019-
TIOL-1564-HCDEL-GST it was held that transitional credit cannot be denied
due to inadvertent error and directed to allow the rectification of Form Tran-1.
In view of the unvarying series of judicial decisions, the taxpayers who have
missed claiming transitional credits initially can now claim the same. The
suggested course of action is as under:
✓ Apply to the Nodal officer on or before 31.12.2019 for enabling the filing
of Form GST Tran-1 online.
✓ If the application is rejected or not acted in a reasonable time, file a writ petition
before the Jurisdictional HC for necessary directions.
CA Madhukar N Hiregange
CA Venkata Prasad
GST
Hiregange Academy 25Hiregange Academy 25
GST – Notifications, Circulars & Orders issued in November 2019
Notification No. And Date Link Description
52/2019-Central Tax
,dt. 14-11-2019View (129 KB)
Seeks to extend the due date for furnishing FORM
GSTR-1 for registered persons in Jammu and
Kashmir having aggregate turnover of up to 1.5 crore
rupees for the quarter July, 2019 to September, 2019
53/2019-Central Tax
,dt. 14-11-2019View (128 KB)
Seeks to extend the due date for furnishing of return
in FORM GSTR-1 for registered persons in Jammu
and Kashmir having aggregate turnover more than
1.5 crore rupees for the months of July, 2019 to
September, 2019
54/2019-Central Tax
,dt. 14-11-2019View (128 KB)
Seeks to extend the due date for furnishing of return
in FORM GSTR-3B for registered persons in Jammu
and Kashmir for the months of July, 2019 to
September, 2019
55/2019-Central Tax
,dt. 14-11-2019View (128 KB)
Seeks to extend the due date for furnishing of return
in FORM GSTR-7 for registered persons in Jammu
and Kashmir for the months of July, 2019 to
September, 2019
56/2019-Central Tax
,dt. 14-11-2019View (471 KB)
Seeks to carry out Seventh amendment (2019) in the
CGST Rules, 2017. [Primarily related to Simplification
of the Annual Return / Reconciliation Statement]
57/2019-Central Tax
,dt. 26-11-2019View (204 KB)
Seeks to extend the due date for furnishing of return
in FORM GSTR-1 for registered persons in Jammu
and Kashmir having aggregate turnover more than
1.5 crore rupees for the months of July, 2019 to
September, 2019
58/2019-Central Tax
,dt. 26-11-2019View (281 KB)
Seeks to extend the due date for furnishing of return
in FORM GSTR-1 for registered persons in Jammu
and Kashmir having aggregate turnover more than
1.5 crore rupees for the month of October, 2019.
59/2019-Central Tax
,dt. 26-11-2019View (203 KB)
Seeks to extend the due date for furnishing of return
in FORM GSTR-7 for registered persons in Jammu
and Kashmir for the months of July, 2019 to October,
2019.
60/2019-Central Tax
,dt. 26-11-2019View (202 KB)
Seeks to extend the due date for furnishing of return
in FORM GSTR-3B for registered persons in Jammu
and Kashmir for the months of July, 2019 to
September, 2019
61/2019-Central Tax
,dt. 26-11-2019View (280 KB)
Seeks to extend the due date for furnishing of return
in FORM GSTR-3B for registered persons in Jammu
and Kashmir for the month of October, 2019
62/2019-Central Tax
,dt. 26-11-2019View (210 KB)
Seeks to notify the transition plan with respect to J&K
reorganization w.e.f. 31.10.2019
Hiregange Academy 26
GST – Notifications & Circulars
Notification No. And Date Link Description
26/2019-Central Tax
(Rate) ,dt. 22-11-2019View (92 KB)
Seeks to insert explanation regarding Bus Body
Building in Notification No. 11/2017-Central Tax
(Rate) dt. 28.06.2017.
25/2019-Integrated
Tax (Rate) ,dt. 22-11-
2019
View (227 KB)
Seeks to insert explanation regarding Bus Body
Building in Notification No. 8/2017-Integrated Tax
(Rate) dt. 28.06.2017.
26/2019-Union
Territory tax(rate), dt.
22-11-2019
View (227 KB)
Seeks to insert explanation regarding Bus Body
Building in Notification No. 11/2017-Union Territory
Tax (Rate) dt. 28.06.2017.
Circular No. And Date Link Description
122/2019, dt 05-11-
2019View(2361 KB)
Generation and quoting of Document Identification
Number (DIN) on any communication issued by the
officers of the Central Board of Indirect Taxes and
Customs (CBIC) to tax payers and other concerned
persons- reg.
123/2019, dt 11-11-
2019View(230 KB)
Seeks to clarify restrictions in availment of input tax
credit in terms of sub-rule (4) of rule 36 of CGST
Rules, 2017
124/2019, dt 18-11-
2019View(619 KB)
Seeks to clarify optional filing of annual return under
notification No. 47/2019-Central Tax dated 9th
October, 2019.
125/2019, dt 18-11-
2019View(915 KB)
Seeks to clarify the fully electronic refund process
through FORM GST RFD-01 and single disbursement.
126/2019, dt 22-11-
2019View(420 KB)
Clarification on scope of the notification entry at item
(id), related to job work, under heading 9988 of
Notification No. 11/2017-Central Tax (Rate) dated 28-
06-2017-reg.
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Order No. And Date Link Description
Order No.8/2019 -
Central TaxView(259 KB)
Seeks to extend the last date for furnishing of annual
return/reconciliation statement in FORM GSTR-
9/FORM GSTR-9C for FY 2017-18 till 31st December,
2019 and for FY 2018-19 till 31st March, 2020
