The petition challenging the transition credit issue under Section 140(7) of the CGST Act, 2017, was rendered unnecessary due to the retrospective amendment made by the Finance (No.2) Act of 2024. The court directed the petitioner to file an appeal, and the Appellate Authority was instructed to consider it on merits, without considering the limitation period, due to the pendency of the petition. The decision was disposed of without any order for costs.

1. Hearing of Counsels (Para 2): Both parties were heard, and it was agreed that the core issue raised in the petition was addressed by the retrospective amendment to Section 140(7) of the CGST Act through the Finance (No.2) Act of 2024.

2. Challenge to Order-in-Original (Para 3): The petitioner had challenged the impugned Order-in-Original dated 27 February 2023, passed by the Joint Commissioner of Central GST & C.Ex. (Respondent No. 4). The court noted that the order was appealable, but no appeal was filed due to the uncertainty around the transition credit under Section 140(7).

3. Opportunity to Appeal Granted (Para 4): Since the issue under Section 140(7) has been clarified by the 2024 amendment, the court saw no reason why the petitioner should not file an appeal. It granted the petitioner four weeks to file the appeal and directed the Appellate Authority to consider it on merits, without applying the bar of limitation.

4. Effect of Finance (No.2) Act of 2024 (Para 5): The Appellate Authority was also directed to take into account the implications of the Finance (No.2) Act of 2024 when deciding the appeal, while leaving all other contentions open.

5. Petition Disposed of (Para 6): The petition was disposed of without any order for costs, and the court directed the concerned authorities to act based on an authenticated copy of this order.

Acts and Sections Discussed:

• Central Goods & Services Tax Act, 2017 (CGST Act)
  • Section 140(7): Deals with transition credit provisions under the CGST regime.
• Finance (No.2) Act of 2024
  • Retrospective Amendment: The amendment clarified issues regarding transition credit under Section 140(7) with retrospective effect, which impacted the petitioner’s case.

Ratio:

The retrospective amendment introduced by the Finance (No.2) Act of 2024 resolved the petitioner’s concerns related to transition credit under Section 140(7) of the CGST Act. Consequently, the petitioner was directed to pursue an alternative remedy (appeal), with the Appellate Authority instructed to consider the appeal on merits, unaffected by the limitation period.

Subjects:

Taxation Law, Goods and Services Tax (GST), Retrospective Amendment, Appeal Process.

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