Dear Experts,
I have come across a situation, where one of my client has received a notice from the GST department that the TRAN-1 credit is ineligible as the conditions u/s 140 were not satisfied.
i.e., (ii) where he has not furnished all the returns required under the existing law for the period of six months immediately preceding the appointed date;
Client has registered under VAT regime on Mar-2017 and file the VAT returns upto Jun-2017 (i.e., 4 months). However, the department are of view that since 6 months returns were not filed, the closing Input tax credit in Jun-2017 VAT returns becomes ineligible.
I seek your assistance in clarification
GST Department Denies TRAN-1 Credit for Non-Compliance with Section 140; Experts Challenge Decision on Filing Requirements A client received a notice from the GST department stating that their TRAN-1 credit is ineligible due to non-compliance with section 140, specifically for not filing returns for six months before the appointed date. The client registered under VAT in March 2017 and filed returns until June 2017, totaling four months. Experts in the forum argue that the department's view is incorrect, as registration in March 2017 makes filing prior returns impossible. They suggest emphasizing this point to the officer, escalating the issue if necessary, and addressing the automated nature of such notices that complicate business operations. (AI Summary)
TaxTMI 
TaxTMI 
TaxTMI 
