Bombay HC in the case of Heritage Lifestyles and Developers and Private Limited

Case Covered:

Heritage Lifestyles and Developers and Private Limited

Versus

The Union of India

Facts of the Case:

Being aggrieved and dissatisfied by the inaction on the part of the Respondent authorities in not giving an Input tax credit to the claim of the Petitioner pursuant to the Board Circular No. 39/13/2018-GST dated 3rd April 2018, the Petitioner has sought to not only challenge the said inaction but also to challenge the vires of Rule 117 and Rule 118 of the Central Goods and Service Tax Rules, 2017 as null and void and ultra vires Section 140 (1), Section 140 (3) and Section 9 of the Central Goods and Services Tax Act, 2017 and Article 14, 19, 246, 248, 265, 268A, 286 and 302 read with entry 41 and 83 of list 1 of Schedule VII of the Constitution of India and as also being beyond the legislative competence of the Parliament under Article 269-A of the Constitution of India and has prayed for the following reliefs:-

(a) that this Hon’ble Court may be pleased to issue Any writ, order or direction more particularly in the nature of a Writ of Declaration to declare Rule 117 and Rule 118 of Central Goods and Service Tax rules 2017 as null, void and ultra vires of Section 140(1), Section 140(3) and Section 9 of Central Goods and Service Tax Act 2017 and Article 14, 19, 246, 248, 265, 268A, 286 and 302 read with Entry 41 and 83 of List 1 of VII Schedule of the Constitution of India and as also being beyond the legislative competence of Parliament under Article 269A of the Constitution of India in so far as it is impugned and pass such further or other orders as this Hon’ble Court may deem fit and necessary in the facts and circumstance of the case and thus render justice;

(b) that this Hon’ble Court be pleased to issue a Writ of Certiorari or a writ in the nature of Certiorari or any other writ, order or direction under Article 226 of the Constitution of India calling for the records pertaining to the Petitioner’s case and after going into the validity and legality of the provisions, direct the Respondents to pass such directions to allow the petitioner to file Tran-1 electronically and carry forward the eligible cenvat credit in the electronic credit ledger/ Input tax credit account;

(c) that this Hon’ble Court be pleased to issue a writ of mandamus or any other writ in the nature of Certiorari or any other writ, order or direction under Article 226 of the Constitution of India calling for the records pertaining to the Petitioner case and direct Respondents to either accept a copy of TRAN-1 in physical form and give due credit from the back end or allow to file the declaration under TRAN-1 electronically and reflect the said input tax credit in the electronic credit ledger/input tax credit account.

Related Topic:
Bombay HC in the case of Daulat Samirmal Mehta Versus Union of India

Observations:

In view of our above discussion, as admittedly in this case the Respondents have found the Petitioner to be eligible for input credit amounting to Rs. 78,62,466/-, in our view the finding of the ITGRC would in the face of the admission by the Respondents to the amount of credit, would be a mere technicality which cannot come in the way of substantial justice.

Accordingly, we direct the Respondents to accept the TRAN-1 filed by the Petitioner and to give the due of an input tax credit of Rs. 78,62,466/- in the electronic credit ledger/input tax credit of the Petitioner within two weeks from the date of this order.

The decision of the Court:

In view of our above order, we do not consider it necessary to examine the Petitioner’s challenge to the vires of Rules 117 and 118 of the Central Goods and Services Tax Rules, 2017.

The Petition is accordingly allowed in the above terms. However, there shall be no order as to costs.

This order will be digitally signed by the Personal Assistant of this Court. The associate of this Court is permitted to forward the parties copy of this order by email. All concerned to act on a digitally signed copy of this order.

Read & Download the Full Decision in pdf: