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The courts have been flooded with litigation on GST with lots of issues in the implementation of GST. We are sharing some key decisions of various High Courts on such matters. 


  • Fresh application for GST Registration can be filed subsequent to rejection of earlier registration application on account of discrepancies in documents


Rajeevan V.N. (Petitioner) filed a registration application under Goods & Services Tax but unfortunately his application got rejected on account of failure to provide explanation for discrepancy in documents submitted by him. Aggrieved by the same he filed a writ petition before the Hon’ble Kerala High Court.


Considering the submissions Kerala High Court held that an applicant whose application for GST registration has been rejected previously may subsequently file a fresh application for obtaining registration.



  • Non filing of Form GST TRAN-1 due to technical glitches on the GST portal cannot be a reason to disallow the transitional credit


Despite his best and continued efforts M/s KTL (P) Ltd (Petitioner) was unable to file GST TRAN-1 on the last date i.e. 27th December, 2017 because the electronic system of GSTIN did not respond and thus suffering the loss of eligible transitional credit. The assessee thus filed a writ petition for the same.


Considering the relevant facts of the case the Allahabad High Court directed to reopen the portal so that GST TRAN-1 could be filed. However, in case the portal is not reopened, the department shall accept the application of the assessee manually and pass orders on it after due verification of the credits claimed. Thus, Non-filing of Form GST TRAN-1 due to technical issues may not be a reason to disallow the transitional credit that an assessee would be entitled for.


Note: - The Central Board of Indirect Taxes and Customs has set-up an IT Grievance Redressal Mechanism to address the grievances of taxpayers due to technical glitches on GST portal. Such grievances may relate to filing of any return or form as prescribed under the law or amending any form or return already filed (Refer Circular No. 39/13/2018-GST dated 03.04.2018).



  • Penalty and seizure under Goods & Services Tax is not sustainable for movement of goods without e-way bill unless there exists malafide intention to evade taxes


Trade is facing difficulties in generating and downloading E-way Bill and applicability of E-way Bill under GST is not clear to many. One such victim was M/s Raj Iron & Building Materials (Petitioner- Assessee) who failed to generate E-way Bill for the movement of goods on account of inter-state inward supplies. Consequence of which the said goods a seizure order was issued for such non-compliance proposing to levy penalty on the grounds that goods are not were not accompanied with E-way Bill.


Accordingly, the Hon’ble Allahabad High Court allowed the writ petition filed by the assessee and set-aside the seizure order as non-sustainable. Holding that the penalty for non-compliance with e-way bill provisions without any intention to evade the payment of taxes is not sustainable.



  • Cancellation of tenders awarded in pre-GST regime but not yet accepted by the participant for tender on account of introduction of GST cannot be said to be illegal or arbitrary


Nirmal Contructions (the petitioner-assessee) was one of the participants for a tender invited by The State of Madhya Pradesh Government(the Respondent) and was awarded such tender pending letter of acceptance. However, with the introduction of GST the government decided to cancel the contract so that future contracts should be invited excluding GST. The petitioner however aggrieved by such decision, filed a writ petition as against the action of the Government.  


After carefully analysing the facts of the case MP High Court held that communication made to the Petitioner-Assessee for cancellation of the tender on account of introduction of GST is not illegal or arbitrary. Since the acceptance of the offer is not communicated to the Petitioner-Assessee, it cannot be construed as a concluded contract. In the absence of concluded contract, the Petitioner-Assessee cannot claim right to seek grant of contract only on the basis of the offer submitted by the Petitioner-Assessee at one stage.



  • Courts cannot interfere Policy formulation  for bringing petrol and diesel within the ambit of Goods & Services Tax


Petrol & Diesel are not within the ambit of Goods & Services Tax but Section 9 of the CGST Act, 2017 provides that petroleum and diesel would be brought within the ambit of GST from such date as the GST Council may deem fit and issue a notification in this regard. Aggrieved by the increase in prices of petrol and diesel within the country K.K. Ramesh (Petitioner in the given case) submitted a representation to The Union of India, The Secretary, Office of the GST Council Secretariat, New Delhi And The Commissioner, Commercial Tax Officer, Cheupakkam, Chennai for bringing such commodities into the GST net. However, when no response was received, he was constrained to approach The Madras High Court by filing a writ petition.


The Madras High Court held that the court is not in a position to issue any positive direction to the Respondents since it is for the Central Government to act on the recommendations of the Goods and Service Tax Council so as to bring the petrol and diesel within the ambit of the Goods and Service Tax net. It is a well-settled position of law that it is not for the Court to determine whether a particular policy or particular decision taken in the fulfilment of that policy is fair and a policy decision can be interfered with only if it is found to be arbitrary or based on an irrelevant consideration or malafide or against any statutory provisions.


The Government may notify the levy of GST on petroleum crude oil, high speed diesel, motor spirit (commonly known as petrol), natural gas and aviation turbine fuel on the recommendation of the GST Council. This being a policy matter, courts cannot interfere.



The information is being shared on the basis of our reading and understanding. The usres of such information are required to confirm and verify the same independently before acting upon it. VJA shall not be liable for any defaults due to any actions taken on the basis of the above information.

Posted on: 17-05-2018