Transitional input tax credit survives rigid portal deadlines where vested credit rights are established and denial would be arbitrary.

Transitional input tax credit accrued under the pre-GST regime was treated as a vested entitlement, and relief was granted where the taxpayer's attempt to upload Form TRAN-I had failed despite repeated extensions of time. The Court held that an inflexible insistence on the portal-based deadline, in the circumstances, would be arbitrary and unreasonable, and that Rule 117(1A) could not validly defeat established credit rights. The taxpayer was therefore entitled to upload TRAN-I and claim the consequential credit, although the rule itself was not formally struck down.

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Issues: Whether the petitioner was entitled to be permitted to upload Form TRAN-I and avail transitional input tax credit despite missing the original time limit, and whether Rule 117(1A) of the Haryana GST Rules, 2017 could validly restrict such relief in the facts of the case.

Analysis: The petitioner had accrued credit under the pre-GST regime and the Court treated the right to carry forward such credit as a valuable vested entitlement. It accepted that repeated extensions of time granted by the authorities themselves showed that the transitional mechanism was intended to protect existing credit rights and that denial of relief merely because the petitioner could not evidence a successful electronic upload would be arbitrary. The Court relied on the view that transitional credit forms part of protected property interests and that a rigid insistence on the portal-based deadline, in these circumstances, would offend fairness and equality principles.

Conclusion: The petitioner was held entitled to upload TRAN-I and to avail the consequential input tax credit, and the challenge succeeded to that extent without formally striking down Rule 117(1A).

Ratio Decidendi: Transitional credit accrued under the pre-GST regime cannot be denied by an inflexible application of the electronic filing deadline where the taxpayer's vested entitlement is otherwise established and the restriction operates arbitrarily and unreasonably.

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