Benefit Of Unutilized ITC Cannot Be Denied If Tran – 1 Could Not Be Filed Due To Fire Accident – Madras High Court

MadrasThe Hon’ble High Court of Madras vide its order dated 13th April 2022 in the matter of M/s Vetrivel Explosives Pvt. Ltd. Vs. Union of India, Goods and Service Tax Networks (GSTN), Goods and Service Tax Council, The commissioner of GST and Central Excise in Writ Petition (MD) No.8250 of 2021 And W.M.P.(MD)No.6231 of 2021, held that the benefit of unutilized ITC lying in the account cannot be denied, when it could not be transferred to GST regime through filing of Tran-1, due to fire accident in the factory.

The Petitioner preferred the Writ Petition before the Hon’ble High Court challenging the impugned communication dated 19.11.2020 which states that ‘You have neither attempted to file Tran-1 return nor come across any technical glitches at the time of filing TRAN-1 return at GSTN common portal. Hence, it is informed that as per the minutes of the 32nd Council Meeting regarding TRAN-1 Credit, your request for enabling of filing of GST TRAN-1 does not merit consideration.”


  • That there was a huge fire accident in the factory of the Petitioner, who is engaged in manufacture of explosives, which resulted in death of few workers.
  • That for about two years the factory was closed and after several round of litigation it was opened again in August, 2018 after the change of regime from Central Excise to CGST Act, 2017. The Factory was under lock and seal up till August, 2018.
  • That due to aforesaid reasons the Petitioner could not file the GST Tran-1, for carrying forward the credit balance available, as required under Section 140 and Rule 117 of CGST.
  • The Petitioner thereafter, made a request to the respondents to allow it to file GST TRAN-1 and the same was rejected.

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