2022 (12) TMI 88 - HC - GST

Petitioner must provide written undertaking to pay assessed GST amounts for registration restoration after portal closure prevented transitional credit completion

The Gauhati HC disposed of a petition regarding transitional credit issues where the petitioner could not complete Tran-1 and Tran-2 transactions due to ... Transitional Credit - grievance of petitioner is that they could not undertake the Tran-1 and Tran-2 transactions as because the GST portal was closed in the meantime - HELD THAT:- In the instant case, the petitioner assessee has made a statement that they are willing to file all the required returns as well as pay all the dues as may be assessed by the Finance and Taxation Department of the Government of Assam. In this respect the case of MAYFLOWER HOTELS AND RESORTS LLP VERSUS THE PRINCIPAL COMMISSIONER OF STATE GOODS AND SERVICE TAX AND 3 ORS. THE JOINT COMMISSIONER STATE TAXES (APPEALS), THE ASSISTANT COMMISSIONER STATE TAXES GUWAHATI, THE SUPERINTENDENT OF STATE TAXES, GUWAHATI [2022 (10) TMI 951 - GAUHATI HIGH COURT] is referrred, wherein in a circumstance where the GST registration was cancelled for non-submission of returns and non-payment of dues, it was provided that the assessee and the department will sit together where the department will inform the assessee as to what is the exact amount of due tax as well as the interest that the assessee may be required to pay on such non-payment of taxes as well as penalty, if any, under the law and the quantified amount would be paid by the assessee to the department and upon it being paid, the department will restore back the registration either in the form of the earlier registration or by providing a new registration number. In the instant case, as because we have already taken note that the petitioner assessee is willing to do all the needful as required by the respondent Department i.e. whatever taxes be assessed will be paid by the petitioner and if interest thereupon will be levied, the same be also paid as well as the penalty, if any, under the law - once the representative of the petitioner will be before the Superintendent of Goods and Services Tax, Guwahati, the Superintendent of Goods and Services Tax will inform the petitioner the total amount of taxes they are required to be paid including the interest and penalty and the petitioner will give a written undertaking in an indemnity bond to the Superintendent of Goods and Services Tax that they are willing to pay the amount. The petitioner to initiate and agree with any amount as may be assessed by the Department as regards the tax, interest and penalty, if any, and pay the same as indicated above and later on, if the petitioner is of the view that there was any over assessment, the petitioner will be at liberty to file appropriate application - Petition disposed off. Issues:- Closure of GST portal affecting Tran-1 and Tran-2 transactions- Applicability of Supreme Court's order in Special Leave to Appeal No. 32709-32710/2018- Cancellation of GST registration due to non-filing of returns and non-payment of dues- Requirement to pay assessed taxes, interest, and penalty to restore GST registration- Need to operate portal for Tran-1 and Tran-2 transactions before portal closureClosure of GST Portal:The petitioner, a GST assessee, faced issues with Tran-1 and Tran-2 transactions due to the closure of the GST portal. The Supreme Court's order directed the GSTN to open the portal for two months, allowing assesses to file forms for availing Transitional Credit. The order emphasized the importance of ensuring no technical glitches during this period and granted officers 90 days to verify claims and reflect allowed Transitional credit in the Electronic Credit Ledger.Applicability of Supreme Court's Order:The High Court found that the relief sought by the petitioner was covered by the Supreme Court's directions in Special Leave to Appeal No. 32709-32710/2018. Consequently, the benefits provided by the Supreme Court's order were made applicable to the petitioner's case, as per the High Court's order dated 23.11.2022.Cancellation of GST Registration:Although the petitioner's GST registration was canceled by the authorities for non-filing of returns and non-payment of dues, the petitioner expressed willingness to comply with all requirements. Referring to a previous order, the High Court highlighted the process where the assessee and the department collaborate to determine and pay the assessed tax, interest, and penalty to restore the GST registration.Requirement to Pay Assessed Taxes:Acknowledging the petitioner's willingness to fulfill obligations, the High Court outlined a procedure where the petitioner, upon being informed of the total amount of taxes, interest, and penalty by the Superintendent of Goods and Services Tax, would provide a written undertaking to pay the specified amount. This undertaking would enable the petitioner to operate the portal for Tran-1 and Tran-2 transactions.Need to Operate Portal Before Closure:To address the urgency of the situation before the portal closure on 30.11.2022, the High Court directed the petitioner to cooperate with the Department, pay the assessed amount, and later file an application if over-assessment was suspected. The petitioner's representative was required to be present before the Superintendent of Goods and Services Tax on 29.11.2022 to ensure compliance with the court's directives. Failure to appear would render further action unnecessary, and the writ petition would stand disposed of accordingly.