Rajasthan HC allows availing of ITC in GSTR-3B due to non-availability of FORM GST ITC-02A .

The Rajasthan High Court allows Assessee to avail Input Tax Credit in GSTR-3B Return due to non-availability of FORM GST ITC-02A on GSTN Portal at the time of its insertion.

The petitioners, M/s Pacific Industries Ltd. approached the Hon’ble Rajasthan High Court assailing the arbitrary action of the GST department whereby, the Petitioner was deprived from submitting FORM GST ITC -02A online and as a conquence, the Petitioner was deprived from availing the Input Tax Credit to the tune of Rs. 2,58,03,590/-.

Senior Advocate Sanjay Jhanwar assisted by Advocate Rahul Lakhwani and Adv Shradha Agarwal, Counsels for the Petitioner submitted before the Hon’ble Court that Rule 41A of the Central Goods and Services Tax Rules 2017 provides for transfer of credit on obtaining separate registration for multiple places of business within a State or Union Territory. Rule 41A was made effective from 01.02.2019. Further, as per Rule 41A of CGST Rules, a registered person is required to file FORM GST ITC -02A electronically on the common portal within 30 days from the date of obtaining new registration for transferring such credit.

It was submitted by the Counsels for the Petitioner that although Rule 41A was made effective from 01.02.2019 but FORM GST ITC-02A was not made available on the GSTN Portal from 01.02.2019. In this case, the Petitioner submitted FORM GST ITC -02A manually within 30 days of obtaining registration but the same was not accepted by the GST Department. Thus, it was argued by the Counsels for the Petitioner that the Petitioner is being deprived of its vested right due to arbitrary actions of the GST Department.

The Hon’ble Division Bench headed by Hon’ble Justice Sandeep Mehta and Hon’ble Justice Vinod Kumar Bharwani held that the action of GST Department is grossly illegal, arbitrary, and unjust. Further, the Hon’ble Bench allowed the Petitioner to avail input tax credit through GSTR-3B return and directed the respondent to regularize the input credit as per the entitlement.

“The respondents are directed to regularise the input tax credit in favour of the petitioner as per entitlement. The petitioner shall be allowed to avail the Input Tax Credit of Rs.2,58,03,590/- through the next GSTR-3B return,” the Court ordered.