FAQ ON RE-OPENING OF TRAN  Based on the directions of the Hon’ble Supreme Court, in the GST portal, the facility to file / revise TRAN-1 / TRAN-2 returns, is going to be re-opened during the period from 01.10.2022 to 30.11.2022, to claim eligible transitional credits under Section 140 of the GST Acts, which were not

FAQ ON RE-OPENING OF TRAN
Based on the directions of the Hon’ble Supreme Court, in the GST portal, the facility to file / revise TRAN-1 / TRAN-2 returns, is going to be re-opened during the period from 01.10.2022 to 30.11.2022, to claim eligible transitional credits under
Section 140 of the GST Acts, which were not claimed earlier. In this connection, the CBIC has also issued a Circular bearing No. 180/12/2022 Dated 09.09.2022 explaining the procedures to be followed in this regard. In this FAQ, an attempt is made to answer various common questions with regard to the issue of claiming transitional credit, using this special opportunity.
03/10
WehavealreadyfiledourTRAN-1/TRAN-2andthecredits
claimedbyuswerealsocreditedtoourElectronicCredit
Ledger.ShouldwehavetoagainfileTRAN-1/TRAN-2now? No. The facility is only for those cases where certain credits have been missed to be taken or to correct any mistakes while claiming such credits.
WehavealreadyfiledourTRAN-1/TRAN-2butduetosome
technicalissues,theamountwasnotatallcreditedintoour ElectronicCreditLedger.WehavefiledWritPetitioninthis
regardandtheHighCourthasalsodirectedthedepartmentto
considerourclaimbuttillnownothinghashappened.Should
wehavetoagainfileTRAN-1/TRAN-2now? Yes. You can make use of this facility.
WhilefilingourTRAN-1,wehavemadesomeclericalmistakes
asaresultofwhichonlylesseramountwascreditedtoour
ElectronicCreditLedger,thanwhatisentitled.Wehavefiled WritPetitionbeforethejurisdictionalHighCourtandthesame
ispending.Canweclaimitnow?
Yes. The current facility is for such cases. You may inform the High Court about the facility now being provided by the Government and get the Writ Petition disposed off accordingly.

04/10
WehavenotclaimedtransitioningofthebalanceofEducation CessandSecondaryEducationCess,lyingasclosingbalancein
ourElectronicCreditLedgerason30.06.2017.Canweclaimit
now?
The issue as to whether the credit of Education Cess and Secondary Education Cess is entitled to be carried forwarded or not is debatable and being litigated. So, even if you claim the same now, the department would deny the same.
If you wish to contest the issue further, by way of challenging such rejection by way of appeal or Writ Petition, you can claim them now. It may be noted that there are contrary judgements from various
High Courts with regard to the eligibility to claim transitioning of
Education Cess and Secondary Education Cess
Whethertheamountclaimednowwouldautomaticallybe
creditedtotheElectroniccreditLedger?
No. The claim will be verified by the jurisdictional officers and a speaking order would be passed after granting a hearing. If the credit is held to be admissible, then the officers will credit the same to the Electronic credit Ledger.
05/10
Ifthejurisdictionalofficerrejectsourclaimforvariousreasons,
whatistheremedy?
The order passed in this regard can be appealed against under Section 107 of the Act or in proper cases, you can also challenge the order by way of Writ Petition before the jurisdictional High Court.
Wehavereceivedsomecapitalgoodsafter01.07.2017onwhich CentralExcisedutywaspaid.Wehavebeenadvisednottoclaim
thecreditascapitalgoodsarenotcoveredunderSection140
(5).Canweclaimitnow?
The plain language of Section 140 (5) does not extend the benefit for capital goods. Only those credits, which are entitled as per Section 140, but wrongly claimed or missed to be claimed alone can be claimed now. As the issue of credit on capital goods in transit is not specifically covered under Section 140, you cannot claim it.
In the alternative, you can claim the same and if the same is rejected by the department, you can contest the issue by filing appeal / Writ Petition against such rejection questioning the non-inclusion of capital goods under Section 140 (5).
06/10
Wehavemissedtoclaimcertaineligibletransitionalcredit
whilefilingourTRAN1.Subsequently,wehavetakenthecredit
inourGSTR3Breturn.Canweusethepresentfacilityto
regularisethecredit?
If the credit already availed by you through GSTR – 3 B has been disputed by the department by issue of show cause notice, you cannot claim the same now and you have to pursue the litigation. If no show cause notice has been issued, you can revise your TRAN-1 now and also inform the department that you have already availed the credit through GSTR 3B return. Such declaration has to be made in Part B of the declaration format prescribed through Circular No. 180. If the credit is otherwise entitled, it is expected that the department would regularise the same. The declaration in Part B, also provides for reversal of such credit now and claim it though this facility.
Continuingwiththepreviousquestion,whetherwewillbe
askedtopayanyinterestforavailingthecreditthrough
GSTR-3B?
If the credit is otherwise entitled, claiming it through GSTR-3B cannot be faulted. Once the facility to claim the credit is once again allowed as per the directions of the Hon’ble Supreme Court, your entitlement to claim such credit shall date back to 1st July 2017 and no interest can be demanded for the same.

07/10
WehavepaidcertainServiceTaxunderreversecharge
mechanismaftertheduedateforfilingTRAN-wasover.Canwe
claimcreditofsuchServiceTaxbyusingthisopportunity. If may be noted that Section 140 does not contain any express provision to allow such credit. It has been held by the Hon’ble High Court of Madras in Ganges International, W.P No. 528 of 2019 that such credits are admissible under Section 142 (3). Since the situation is not directly covered under Section 140, such claims are likely to be rejected by the department. But, you may claim the same and if the same is rejected, the same may be contested by way of appeal.
Weareentitledtoclaimcreditofexcisedutiespaidonthe
inputslyinginstockwiththemason30.06.2017asperSection 140(3)oftheAct.Wehavealsodeclaredthedetailsofsuch
stockinourTRAN-1.But,sincewearenothavingdutypaying
documents,weshouldhavefiledTRAN-2forthefirstsix
monthsafterintroductionofGST,givingdetailsofthesales
madefromsuchstockandbasedonthetaxpaidonsuch
supplies,wewouldhavebeenentitledtotransitionalcredit,as
providedfor.But,wehavenotfiledsuchTRAN-2returnsdueto
ignorance.Canweusethepresentfacilitytoclaimsuchcredit? Yes. You can now file TRAN-2, showing the details of the supplies made during the period from July 2017 to December 2017, by indicating the last month in which such sales was made.
08/10
Weareentitledtoclaimcreditofexcisedutiespaidonthe
inputslyinginstockwiththemason30.06.2017asperSection 140(3)oftheAct.Butsuchcreditisrestrictedonlyinrespectof
thoseinputs,wherethedutypayingdocumentsaredatedupto
oneyearpreceding01.07.2017only.Wealsohavestockof
inputspurchasedpriortoJuly2016.Canweclaimcreditin
respectofsuchstocknow?
As per the plain language of Section 140 (3), such credit is entitled only for the purchases made upto one year before. So even if you claim such credit now, the same would be rejected by the department. If you wish to contest the prescription of such time period for availing transitional credit in respect of the stock on hand, you can claim the same and once the same is rejected, you can challenge the same by way of filing a Writ Petition, challenging the prescription of such time limit. It may be noted that already there are contrary judgements from two High Courts on the issue.
WhilecarryingforwardthebalanceofVATcreditason 30.06.2017wehavereducedourentitlementtotheextentof
pendingForms(FormC,etc.).Subsequentlywehavereceived
suchforms.CanwenowreviseourTRAN-1toclaimcreditfor
theformsreceivedsubsequently?
No. The respective State SGST Acts provided for claim of refund in such cases, which could have been claimed by you. Further Tables 5 (b) and (c) of TRAN-1 is not going to be re-opened now to claim such credits.
09/10
WehadaclosingbalanceofcenvatcreditinourInputService Distributor(ISD)registration.WehavefiledTRAN-1inourISD
registrationandtheamountwasalsocreditedtotheElectronic CreditLedgeroftheISD.Butwewerenotabletodistributesuch
credit,afterintroductionofGST,asonlytheregularGSTcredits
couldbedistributedbyISDs,byfilingGSTR-6.Whatcanbe
donenow?
Even though ISDs were allowed to file TRAN-1 and the amount was also credited to the Electronic Credit Ledgers of ISDs, subsequently, no Electronic Credit Ledger is available for ISDs. As per Section 140 (7), such closing balance of credit with ISD could have been claimed by the respective units, by claiming such credit in the TRAN-1 filed by such units, as per the formula for distribution under Cenvat Credit Rules, 2004. Now, the different units of the entity having closing balance of credit with ISD, can file / revise their TRAN-1 and claim proportionate credit entitled for them.
WehavefiledourTRAN-1andclaimedvarioustransitional
credit.Thedepartmenthasobjectedtocertaincreditsavailedby
usandissuedshowcausenotice.Inordertoavoidinterest
liabilitywehavereversedsuchcreditandcontestingtheissue,
whichiscurrentlypendinginappeal.Canweclaimthecredit
now?
As your entitlement to such credit is currently a subject matter of dispute, you have to pursue the litigation and you cannot reclaim the credit now. 12.09.2022)
10/10
THANK YOU

G. Natarajan Advocate, G N Law Associates
contact us