CBIC has issued guidelines for aggrieved registered persons (taxpayers/assessees) in relation to filing/revision of GST TRAN-1/TRAN-2 to claim transitional credit, vide GST Circular 180/12/2022, in light of the Orders of the Hon’ble Supreme Court dated 22/07/2022 and 02/09/2022 in Union of India vs. Filco Trade Centre Pvt. Ltd., SLP(C) No. 32709-32710/2018.
CBIC GST Circular 180/12/2022 dt. 09/09/2022: CBIC guidelines for aggrieved registered persons (taxpayers/assessees) in relation to filing/revision of GST TRAN-1/TRAN-2 to claim transitional credit
The operational portion of the Hon’ble Supreme Court’s judgement in Union of India vs. Filco Trade Centre Pvt. Ltd., SLP(C) No. 32709-32710/2018 contains the following directions:
i) GSTN will open the common portal for filing relevant forms for obtaining Transitional Credit via TRAN-1 and TRAN-2 for two months, from September 1 to October 31, 2022.
ii) Any aggrieved registered assessee must file the relevant form or revise the previously filed form, regardless of whether the taxpayer has filed a writ petition before the High Court or whether the taxpayer’s case has been decided by the Information Technology Grievance Redressal Committee (ITGRC).
iii) GSTN to ensure that there are no technical glitches during the two-month period;
iv) Following that, the concerned GST officers allowed a 90-day period to verify the veracity of the claim/transitional credit and pass appropriate orders on merits after providing appropriate reasonable opportunity to the parties involved.
v) As a result, the permitted Transitional credit must be reflected in the Electronic Credit Ledger; and
vi) The GST Council may also issue appropriate guidelines to scrutinise the claims if necessary.
Subsequently, in Miscellaneous Application No. 1545-1546/2022 in SLP(C) No. 32709-32710/2018, the Hon’ble Supreme Court, by order dated 02/09/2022, extended the timeline for the launch of the GST Common Portal by four weeks.
The facility for filing TRAN-1/TRAN-2 or revising the previously filed TRAN-1/TRAN-2 on the common portal by an aggrieved registered assessee (applicant) will be made available by GSTN from 01/10/2022 to 30/11/2022 in accordance with the Hon’ble Supreme Court’s instructions. With the authority granted by section 168(1) of the CGST Act of 2017, the CBIC has clarified a few issues in order to ensure consistency in the application of the Hon’ble Supreme Court’s directives.
CBIC Guidelines for filing/revision of TRAN-1/TRAN-2
The applicant may upload a declaration in the form GST TRAN-1/TRAN-2 to the common portal or edit a previously submitted TRAN-1/TRAN-2 that has been properly signed or verified with an electronic verification code. A facility for downloading the previous TRAN-1/TRAN-2 will be made available on the common portal when an applicant submits a revised TRAN-1/TRAN-2.
The applicant must upload a pdf copy of the declaration in the format outlined in Annexure “A” of this circular along with the declaration when filing or amending it in FORM GST TRAN-1/TRAN-2. A pdf copy of TRAN-3 that includes the information required by Notification No. 21/2017-CE (NT) dated 30/06/2017 is also required to be uploaded by the applicant who is claiming credit in table 7A of FORM GST TRAN-1 based on a Credit Transfer Document (CTD).
In relation to C-Forms, F-Forms, and H/I-Forms issued after the due date prescribed for submitting the declaration in FORM GST TRAN-1, i.e. after December 27, 2017, no claim for transitional credit shall be filed in table 5(b) and 5(c) of FORM GST TRAN-1.
Instead of filing the claim tax period by tax period as required by CGST Rule 117(4)(b)(iii), the applicant must submit the entire claim in one consolidated FORM GST TRAN-2. In these circumstances, the applicant must indicate in the “Tax Period” column of the GST TRAN-2 the last month of the consolidated period for which the claim is being made.
The applicant must download a copy of the TRAN-1/TRAN-2 and submit a self-certified copy of the same, along with the declaration in Annexure “A” and copy of TRAN-3, where applicable, to the jurisdictional tax officer within seven days of submitting the declaration in FORM TRAN-1/TRAN-2 on the common portal. The applicant must keep all required records, documents, returns, and invoices on hand for the concerned tax officers to review in order to support his claim for a transitional credit.
It is crucial to remember that the TRAN-1/TRAN-2 filing or revision window on the common portal, which runs from 01/10/2022 to 30/11/2022, is a one-time chance for the applicant to file the relevant forms, if they haven’t already been, or to make changes to those that have already been submitted. When submitting or amending TRAN-1/TRAN-2 forms, the applicant must proceed with the utmost caution and care. He or she must also carefully review all of the information before submitting his claim to the common portal. It is made clear that the applicant may only make changes to the information on the Common Portal’s FORM TRAN-1/TRAN-2 prior to clicking the “Submit” button. The applicant may edit, add, or delete any record in any table of the forms before clicking the “Submit” button. The form becomes frozen when the “Submit” button is clicked, preventing any further editing of the data. A digital signature certificate (DSC) or an EVC must then be attached to this frozen form and uploaded to the portal using the “File” button. The applicant must verify that all of the information on FORM TRAN-1/TRAN-2 is accurate before pressing the “Submit” button. The applicant should bear this in mind when submitting the forms on the portal, as GSTN will issue a thorough advisory in this regard.
Further, CBIC has made it clear that once an applicant files TRAN-1/TRAN-2 or updates the aforementioned forms previously submitted on the common portal, he will not have another opportunity to do so during this time period or in the future, in accordance with the Hon’ble Apex Court’s order.
Additionally, the CBIC has made it clear that registered individuals who have successfully filed TRAN-1/TRAN-2 in the past and do not need to do so again are not required to do so between October 1, 2022, and November 30, 2022. In this regard, it should be noted that the proper course of action is to file an appeal against the said order or to pursue alternative remedies provided by law in cases where the credit obtained by the registered person on the basis of FORM GST TRAN-1/TRAN-2 filed earlier has been rejected by the proper officer. The appropriate course of action in these situations would be to pursue the adjudication or appeal that is currently pending. Under the special dispensation offered by this circular, filing a new declaration in FORM GST TRAN-1/TRAN-2 is not the proper course of action in such circumstances.
It should be noted that the declaration made by the applicant in Form GST TRAN-1/TRAN-2 will be subject to the necessary tax officers’ verification. The applicant might be asked to provide the required records, returns, invoices, and/or documents to the relevant tax officers for verification in order to support their claim for a transitional credit. The jurisdictional tax officer will verify the claim and, after giving the applicant a fair chance to be heard, will issue an appropriate order on the merits. The applicant’s Electronic Credit Ledger on the common portal will reflect the transitional credit that the jurisdictional tax officer has approved.