Section 140 of the CGST Act, 2017 —Transitional Credit - The Petitioner filed Trans -1 by carrying forward the unadjusted closing balance of VAT credit declared in the revised VAT return. The Petitioner received a notice for review of the order of assessment on the ground that transitional credit availed of by the Petitioner based on a revised return was not permissible in terms of Circular No. 35A dated 19 October 2019 and unadjusted VAT credit carried forward was denied. The court observed that impugned order has relied upon internal Circular No. 35A. But they did not find any discussion in the impugned order as to whether the Petitioner is entitled to the term set of the transitional credit. The arguments advanced are entirely different from the foundation of the impugned order, which has solely relied upon the Circular. The order should be self-speaking. It cannot be that the Authority passes an order without reasons.

Held that:- The Hon’ble High Court quashed the order dated 4 October 2022. If the Respondents proceed to exercise power under section 25 of the MVAT Act, will issue notice to the Petitioner as per law and pass necessary orders.