TMI Blog2022 (2) TMI 846X X X X Extracts X X X X X X X X Extracts X X X X ..... it of the Central Government is a vested right of the person. Such vested right cannot be defeated on account of any irregularity in the system evolved by the Government. The respondents are directed to allow the writ applicant to furnish manually the GSTR 6 return with details of the ISD credit of ₹ 20,52,989/- and also permit distribution of such credit to the constituents of the writ applicant. Let this entire exercise be undertaken within a period of six weeks from the date of the receipt of writ of this order - Petition allowed. - R/Special Civil Application No. 9151 of 2021 - - - Dated:- 11-2-2022 - Honourable Mr. Justice J.B.Pardiwala And Honourable Ms. Justice Nisha M. Thakore For the Petitioner(s) : Amal Paresh Dave, Mr Paresh M Dave For the Respondent(s) : Priyank P Lodha, Notice Served ORAL ORDER (PER : HONOURABLE MR. JUSTICE J.B.PARDIWALA) 1. By this writ application under Article 226 of the Constitution of India, the writ applicant has prayed for the following reliefs: (A) That Your Lordships may be pleased to issue a Writ of Mandamus or any other appropriate writ, direction or order, thereby directing the Respondents to al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ST TRAN 1 wherein the balance of the Cenvat Credit lying with the writ applicant on 30.06.2017 including the un-utilized balance of ISD Cenvat Credit was ₹ 20,52,989/-. The writ applicant filed a return in Form CGST 06 with details of balance of Cenvat Credit lying on 30.06.2017 for transferring such credit to the GST regime. However, on account of an error in the GST network, the Cenvat Credit balance in the return was shown at ₹ 2,96,528/-. The ISD balance of ₹ 20,52,989/- was not added or included in the balance of the ISD credit in the return. 5. The writ applicant has been requesting the Nodal Officer and also the jurisdictional Assistant Commissioner of GST for correcting the balance in the ISD return by including the balance credit of ₹ 20,52,989/-. Over a period of time, many representations have been filed by the writ applicant as regards the aforesaid but of no avail. In such circumstances referred to above, the writ applicant is here before this Court with the present writ application. 6. We have heard Mr. Tripathi, the learned counsel appearing for the writ applicant and Mr. Priyank Lodha, the learned Standing Counsel appearing for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ute or doubt about payment of tax from ITC also. 2.11 It is further the case of the petitioner that the entire tax liability of August, 2017, having been discharged by 19th September, 2017, the petitioner proposed to furnish GSTR-3B on 20th September, 2017; but the common portal was not running properly due to heavy load because millions of registered persons were trying to upload their returns and the common portal which was introduced only in July, 2017 was not capable of taking such a huge load. Consequently, the petitioner s efforts to upload GSTR-3B on 20th September, 2017 failed. On the next day, that is, on 21st September, 2017, the System crashed. Due to this unfortunate turn of events, the System accepted the petitioner s GSTR-3B on 21.9.2017, but the information and details in all the columns of this return were shown as zero , though the payment of tax liability of the month had also been fully made by the petitioner. 2.12 Since GSTR-3B was uploaded on the common portal in the above manner, the requirement of sub-rule (2) of rule 88 of the CGST Rules, that is, indicating the Unique Identification Number relating to discharge of the liability in the correspondi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing tax liability for the subsequent months, that is, September, 2017 and thereafter in accordance with the law during this period when the petitioners were waiting for the Government s further circular and clarification about GSTR-2 and GSTR-3. But, in December, 2017, the Government decided that time period for filing of GSTR-2 and GSTR-3 for July, 2017 to March, 2018 would be worked out by a Committee of Officers, and accordingly, the previous Circular dated 1.9.2017 was kept in abeyance till such time. Thus, the assurance given to the petitioner by the Officers manning the Help Desk did not result in any positive action or development. The return in form GSTR-3B for August, 2017 continues to have all information and details as zero , and consequently, the entry about discharging tax liability of August, 2017 in the petitioner s electronic liability register as required under rule 88(2) of the CGST Rules is still not made. 2.17 In this view of the matter, the petitioner had been continuously approaching all the responsible officers of Ahmedabad-North Commissionerate, and also the higher officers like the Chairman of the Central Board of Indirect Taxes and Customs as well as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ause there is no such process defined under law. The petitioner is advised to follow the instructions/guidelines mentioned in paragraph 3 of the Circular dated 29.12.2017. On enquiry by the petitioner as to in what manner instructions/guideline mentioned in paragraph 3 of the above referred Circular should be followed, the petitioner has been informed by the Officers that the petitioner s case would fall under Common Error-I of Annexure to the above Circular, and as clarified for cases of Liability was under reported , the petitioner should pay the liability of tax with interest. 2.19 In the aforesaid factual background, the situation that still prevails is that a formal entry in the petitioner s electronic liability register for discharging tax liability of August, 2017 is still not made in the system though the petitioner had paid the entire tax liability of August, 2017 by way of cash payment aggregating to ₹ 114.51 crores (rounded off) and that of ₹ 14.12 crores (rounded off) from legally availed ITC. Though true and full information about the tax liability and also its payment in respect of August, 2017 stands reflected in the return furnished in Form GSTR-1, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the principal amount of tax liability of August, 2017 may be declared in such return, and not the liability of interest, subject to the outcome of the petition. Accordingly, it appears that the petitioner was permitted to file FORM GSTR-3B for September, 2019 with taxes payable for August, 2017 and the same has been accepted by the system and, accordingly, the amount of tax payable for August, 2017, which was lying with the designated bank has now been credited to the Government account and the taxes payable are now shown as nil. 6. In the light of the above events, the principal grievance voiced in the petition, therefore, no longer survives. However, the issue regarding liability to pay interest for eighteen months from 21.9.2017 to October 2019 at a substantially high rate of 18% per annum still remains to be addressed. 7. Mr. Paresh Dave, learned advocate for the petitioner invited the attention of the court to the averments made in the memorandum of petition, to point out that it is only after issuing the letter dated 7.3.2019, on the petitioner s inquiry, that the respondents informed the petitioner that its case would fall in the appropriate table set out in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pondents had submitted that the petitioner was asked to pay tax with interest only in March, 2019 after issuing the letter dated 7.3.2019, which was about eighteen months, after creating an impression which gave rise to a bona fide belief on the part of the petitioner that the issue would be sorted out in due course. It was submitted that the petitioner had duly filed the return for the month of August, 2017 and had also deposited that tax payable for such period; however, on account of glitches in the system such amount could not be credited to the Government account. It was submitted that the petitioner had thereafter immediately approached the respondent authorities for resolving the issue; however it was on account of the default on the part of the respondent authorities that the error could be corrected only in October, 2019. It was submitted that on account of default on the part of the respondents, the petitioner should not be saddled with the liability of paying excessive interest at the rate of 18% for the intervening period between the date of filing of the return and the filing of form GSTR-3B in October, 2019. 8. This court has also heard Mr. Nirzar Desai, learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the record, it is manifest that despite the fact that the petitioner had approached them at the earliest point of time, the respondent authorities maintained silence for a considerable period of time and did not provide remedial measures till directed by this court. The errors in uploading the return were not on account of any fault on the part of the petitioner but on account of error in the system. In these circumstances, it would be unreasonable and inequitable on the part of the respondents to saddle the petitioner with interest on the amount of tax payable for August 2017, despite the fact that the petitioner had discharged its tax liability for such period well within time. 13. The respondents, in paragraph 19 of their affidavit-inreply, have submitted that CIN is generated after deposit of money by the petitioner for the purpose of payment of tax. CIN is generated by the authorised banks/ Reserve Bank of India (RBI) when payment is actually received by such authorised banks or RBI, which then is seen as credit balance in the electronic cash ledger of the petitioner. In response to such submission made on behalf of the respondents, the learned advocate for the petitione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x amount for the period from 21.9.2017 to October, 2019. 15. In the light of the above discussion, the petition succeeds and is, accordingly, allowed. It is held that the declaration submitted by the petitioner in October, 2019 along with the return of September, 2019 shall be treated as the petitioner having discharged its tax liability of August, 2017 within the period stipulated under the GST laws. The petitioner shall not be liable to pay any interest on such tax amount for the period from 21.9.2017 to October, 2019. Rule is made absolute accordingly, with no order as to costs. 9. We are of the view that the respondents cannot raise their hands in despair saying that it is not possible to correct or take care of the technical glitches. The writ applicant herein has been running from pillar to post requesting the respondents to provide a solution and take care of the technical error and glitch that occurred as regards furnishing the GSTR 6 return for recording and distributing the ISD credit of ₹ 20,52,989/-. As usual, there is no response at the end of the GSTN. The writ applicant is not allowed to distribute the ISD credit of ₹ 20,52,989/- as the same h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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