Section 140 of the CGST Act, 2017 —– Transitional Credit —- The petitioner prayed for directions to the Respondents to allow the Petitioner the benefits of transitional credit by allowing them to file declaration electronically in Form GST TRAN-1. The writ applicant company’s bank account was declared as NPA (Non Performing Assets) and in absence of sufficient staff, the writ applicant company could not filed TRAN – 1 on or before the notified date i.e. 27.12.2017. The court observed that the applicant belatedly had applied for filing of Form TRAN – 1. The reason explained for delayed uploading of the Form appears to be genuine as the bank account of the writ applicant company was declared Non Performing Account. The applicant company had sufficient cause to not to apply for the availment of ITC during transitional period. Vide Notification No.48/2018, dated 10.09.2018, the due date for submitting the GST TRAN-1 was extended up to 31.03.2019 and the portal was reopened for the registered persons, who could not filed it earlier. In the given circumstances as well as the legal position as settled by various courts, it is held that Rule 117 of the CGST Rules being directory in nature, the prescribed time limit for transitioning of credit would in no manner result in forfeiture of the rights of the writ applicants. The period of three years as described by the High Court of Delhi to be a guiding principle for availing of such credit from the appointed date, the case of the writ applicant falls within the aforesaid period of three years.

Held that:- The Hon’ble High Court directed the respondent to permit the applicant to file Form GST TRAN-1 either by opening the online portal so as to enable the writ applicant to file declaration TRAN-1 electronically or to accept the same manually. The respondent authorities shall verify and process such Form in accordance with law within a period of two weeks.