Delhi HC Directs The GST Commissioner To Allow A Taxpayer To Rectify Errors Made In The TRAN-1 Form
Delhi High Court has directed the GST Commissioner to allow a company which had made an error in filing the TRAN-1 form online to rectify the same immediately. The court has asked the authority to either open the online portal so as to enable the Petitioner to again file the rectified TRAN-I Form electronically or accept the manually filed TRAN-I Form with the correction on or before 31st July, 2019.
The Central Government in the exercise of the powers under Section 140(5) read with Section 164 of CGST Act read with Rule 117 of the CGST Rules
prescribed the GST TRAN- 1 Form which was required to be filed online as a condition precedent for allowing the Petitioner to carry forward the CENVAT credit on input used for manufacturing of the finished goods.
In the present case, the Petitioner had contended that after the due date for filing of the TRAN-1 Form was crossed, the system got locked down at the portal and no taxpayer was able to view/mend their TRAN-1 forms. The portal opened up on 15th March, 2018 for filing the TRAN- 2 Returns. It was at that stage that the Petitioner realised that it had committed an inadvertent error in the TRAN-1 Form. The system, however, did not permit the Petitioner to revise the TRAN-1 Form. The Petitioner made several representations before both the GST Nodal Officer and the GST Commissioner but did not receive any remedy. The amount in question was over 20 lakhs.
The court relied on two of its recent judgments, namely, Bhargava Motors v. Union of India, and Kusum Enterprises Pvt. Ltd. v. Union of India where in similar circumstances it had issued directions to the Respondents to either open the portal to
enable the Petitioner to rectify the TRAN-1 Form electronically or permit the Petitioner to do it manually. The court noted that although the failure was on the part of the Petitioner to fill up the data concerning its stock in Column 7(d) of Form TRAN-1instead of Column 7(a), the error was inadvertent. The Respondents ought to have provided in the system itself a facility for rectification of such errors which are clearly bona fide.
The Respondents had argued that if such a case is allowed it would open the floodgates of complaints moved on the account of negligence on the part of the taxpayers. The Division Bench of Justice S Muralidhar and Justice Talwant Singh rejected this claim by opining that if Respondents provide a robust Grievance Redressal Mechanism to deal with such complaints, the matters would not reach the court. The court also observed that despite Information Technology Grievances Redressal Committee (ITGRC) being in place, Petitioner's grievance never reached the said forum.
The court, therefore, directed the error committed by the Petitioner to be rectified and also waived off any penalty or interest thereon for late filing of GSTR-3B.