GST portal failure cannot defeat vested ISD credit; manual GSTR-6 filing allowed to preserve credit entitlement.

A vested ISD credit right could not be defeated by a GST portal failure that prevented electronic reflection of the credit in GSTR-6. The Gujarat HC found that the credit had lawfully accrued from tax already paid and that repeated attempts to correct the technical error had failed because of the system glitch. It therefore permitted manual filing of GSTR-6 with the ISD credit particulars and directed distribution of the credit to the relevant constituents, so that the assessee's substantive credit entitlement was preserved despite the electronic filing defect.

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Issues: Whether the writ applicant was entitled to manual filing of GSTR-6 and consequential distribution of unrecorded ISD credit despite system error preventing electronic reflection of the credit.

Analysis: The unutilized ISD credit had arisen from tax already paid and was part of the credit mechanism carried forward into the GST regime. The Court found that the applicant had repeatedly sought correction of the technical error, but the system failure prevented proper recording and distribution of the credit in GSTR-6. It held that a vested credit right cannot be defeated by technical glitches in the governmental electronic system and that the inability of the portal to capture the return should not prejudice the assessee.

Conclusion: The applicant was entitled to furnish GSTR-6 manually with the ISD credit details and to have the credit distributed to its constituents.

Final Conclusion: The petition was allowed and effective relief was granted to cure the system-generated failure so that the credit could be reflected and distributed in accordance with law.

Ratio Decidendi: Tax credit lawfully accrued cannot be denied merely because of technical failure of the electronic filing system, and the court may direct manual compliance to preserve the assessee's substantive credit entitlement.

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