Dismissed

M/S. Malabar Cements Ltd., v. the Assistant Commissioner

Kerala HC19 Oct 2023WP(C)/12899/2023

Case brief

AI extract

What is this about?

The High Court dismissed the writ petition filed by the petitioner challenging orders rejecting its belated application for extending limitation to claim transitional GST credit. The Court found no error in the Commissioner's rejection of the application filed five years after the due date, noting the statutory deadline was not met. The petition was disposed of.

What the court decided

AI extract

M/S. Malabar Cements Ltd., Vs the Assistant Commissioner — GST and Indirect Tax | Kerala HC (2023)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MR. JUSTICE DINESH KUMAR SINGH
THURSDAY, THE 19TH DAY OF OCTOBER 2023 / 27TH ASWINA, 1945
WP(C) NO. 12899 OF 2023

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PETITIONER:

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M/S. MALABAR CEMENTS LTD.,
WALAYAR DAM POST, PALAKKAD, REPRESENTED BY ITS
MANAGER (FINANCE) I/C, RAMESH BALAGOPALAN.

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BY ADVS.
 SRI. HARISANKAR V. MENON
 SRI. MEERA V.MENON
 SRI. R. SREEJITH
 SRI. K. KRISHNA
 SRI. PARVATHY MENON

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RESPONDENTS:

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1THE ASSISTANT COMMISSIONER,
CENTRAL TAX AND CENTRAL EXCISE,
PALAKKAD DIVISION,CR BUILDINGS,
METTUPALAYAM STREET, PALAKKAD, PIN – 678001.

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2 THE COMMISSIONER, CENTRAL TAX AND CENTRAL EXCISE, C R BUILDINGS, MANANCHIRA, KOZHIKODE, PIN – 673001.

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3THE DEPUTY COMMISSIONER,
CENTRAL TAX AND CENTRAL EXCISE,
PALAKKAD DIVISION, C R BUILDINGS,
METTUPALAYAM STREET, PALAKKAD, PIN – 678001.

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4UNION OF INDIA,
REPRESENTED BY SECRETARY TO GOVERNMENT,
MINISTRY OF FINANCE (DEPARTMENT OF REVENUE),
NORTH BLOCK, NEW DELHI, PIN – 110001.

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BY ADV.
 SRI. P. G. JAYASHANKAR

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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON
19.10.2023, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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WP(C) NO. 12899 OF 2023

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DINESH KUMAR SINGH, J.

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W.P.(C) No.12899 of 2023

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Dated this the 19^th day of October, 2023

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JUDGMENT

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The present writ petition has been filed seeking quashing of Exhibits P-4 and P-5 orders passed by the 2^nd and 3^rd respondents respectively, whereby the petitioner’s claim for transitional credit in respect of inward supplies made before 01.07.2017 have been denied and the petitioner’s application for extending the limitation for claiming the transitional credit within the extended period of limitation of sixty days has been rejected by the 2^nd respondent Commissioner vide Exhibit P-4 order.

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After the GST Act came into force with effect from 01.07.2017, the input tax credit in respect of the inward supplies before 01.07.2017 could have been claimed under the provisions of GST Act within a period of thirty days and with the extended period of limitation of thirty days by the Commissioner as provided under Section 140 of the GST Act. Sub-section (5) of Section 140 of the GST Act reads as under;

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WP(C) NO. 12899 OF 2023

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(5) “A registered person shall be entitled to take, in his electronic credit ledger, credit of eligible duties and taxes in respect of inputs or input services received on or after the appointed day but the duty or tax in respect of which has been paid by the supplier under the existing law, within such time and in such manner as may be prescribed, subject to the condition that the invoice or any other duty or tax paying document of the same was recorded in the books of account of such person within a period of thirty days from the appointed day:

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Provided that the period of thirty days may, on sufficient cause being shown, be extended by the Commissioner for a further period not exceeding thirty days:

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Provided further that said registered person shall furnish a statement, in such manner as may be prescribed, in respect of credit that has been taken under this subsection.”

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Thus, from perusal of Sub-section (5) of Section 140 of the GST Act, it is evident that beyond the period of thirty days an assessee can claim the transitional credit of input tax within another thirty days on an order passed by the Commissioner. Unless the order is

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WP(C) NO. 12899 OF 2023

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passed by the Commissioner extending the period of limitation up to sixty days or less than , an assessee cannot claim the input tax credit in respect of the inward supply taken before 01.07.2017. In the present case, the petitioner claimed input tax credit in his return after the initial period of thirty days expired, but without any order from the Commissioner extending the period of limitation beyond thirty days. He filed an application after five years for extending the time of limitation for claiming transitional credit. The Commissioner therefore, has rejected the application in Exhibit P-4 order stating as under;

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“This refers to your application under Ref No.1, corrigendum under Ref. No.2 and letter under Ref. No.3 on the subject. Records show that the TRAN – 1 return is filed by the applicant on 27.12.2017. The application for extension as per the first proviso to Section 140 (5) should have been submitted within a reasonable time, i.e. before filing of TRAN-1 return. The application has been received in this office on 24.1.2023, more than five years of filing of TRAN – 1 return, for which no cause has been provided. Also, the application has ben filed consequent to finding of irregularity in the SSCA on Transitional Credits by the C & AG. As such, the application filed by you under Section 140 (5) of the CGST Act, 2017 is rejected.”

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WP(C) NO. 12899 OF 2023

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I do not find that the Commissioner has committed any error of law or jurisdiction in rejecting the application which has been filed belatedly after five years from the prescribed date. As the limitation period was not extended, the petitioner has been denied the benefit of transitional credit in respect of input tax vide Exhibit P-5 order in original dated 13.03.2023.

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In view thereof, I do not find much substance to entertain this writ petition. However, if the petitioner is aggrieved by the merits of the order dated 13.03.2023 in Exhibit P-5, he may take recourse of statutory remedy, if any, available to him. So far as the question of limitation is concerned, the period spent in prosecuting this writ petition shall be excluded while calculating the period of limitation in filing the appeal against Exhibit P-5 order.

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With the above view this writ petition is finally disposed of.

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Sd/-

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DINESH KUMAR SING JUDGE

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Svn

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WP(C) NO. 12899 OF 2023

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APPENDIX OF WP(C) 12899/2023

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PETITIONER’S EXHIBITS

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EXHIBIT P1COPY OF APPLICATION FILED BY THE PETITIONER
BEFORE THE 2ND RESPONDENT DTD. 19-01-2022

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EXHIBIT P2COPY OF SHOW CAUSE NOTICE UNDER SECTION 73
ISSUED BY THE 2ND RESPONDENT DTD. 07-04-2022

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EXHIBIT P3COPY OF REPLY FILED BY THE PETITIONER FOR THE
SHOW CAUSE NOTICE DTD.30-04-2022

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EXHIBIT P4COPY OF ORDER ISSUED BY THE 2ND RESPONDENT
DTD. 02-03-2023

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EXHIBIT P5COPY OF ORDER ISSUED BY THE 3RD RESPODNENT
DTD. 13-03-2023
EXHIBIT P6COPY OF CIRCULAR NO,. 37/11/2018-GST ISSUED
BY GOVERNMENT OF INDIA, NEW DELHI DTD. 15-03-
2018

M/S. Malabar Cements Ltd., v. the Assistant Commissioner

Case brief

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M/S. Malabar Cements Ltd., v. the Assistant Commissioner

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