Full Capital Goods Credit Never Taken Under CENVAT Can Pass Through TRAN‑1: GSTAT Chandigarh

GSTAT Chandigarh allowed transition of ₹2,13,593 credit on capital goods received before GST, rejecting the view that only the second 50% instalment could be carried forward.

GSTAT Chandigarh has held that Section 140(2) of the CGST Act allows the entire unavailed CENVAT credit on capital goods to be carried into GST through TRAN‑1, even where no part of it was taken under the pre-GST law. [Ashwani Kumar Sharma v. Bhagat Deepak Kumar, Joint Commissioner, Ludhiana Chandigarh & Ors., 2026-juristway.com-3163-GSTAT(Chandigarh)-GST]

The Bench of Jatinder Pal Singh, Member (Judicial), and Pradeep Kumar Goel, Member (Technical), allowed the appeal of M/s JSW Vallabh Tin Plate Pvt. Ltd., now JSW Steel Coated Products Ltd. It noted that the cause title on the portal wrongly showed the company’s official and the appellate authority as the parties.

The appellant had not taken CENVAT credit on certain capital goods received before 1 Jul 2017 because inspection was pending, and claimed the full ₹2,13,593 through TRAN‑1. The authorities denied it, reading Section 140(2) and Circular No. 182/14/2022-GST as covering only cases where part of the credit had already been taken. ₹1,54,400 was also denied because 81 invoices were entered under a single invoice number.

Following its order in Deltron (a Division of Continental Device India Pvt. Ltd.) Vs. Commissioner CGST Ludhiana & Ors. (2026 (10) TMI 1226), the Bench held that Section 140(2) permits transition of credit not carried forward in a pre-GST return, without limiting it to 50%. The Explanation defines unavailed credit as the eligible amount less what was already availed, and nothing in Rule 117(2)(a) requires the availed amount to be more than nil.

On the 81 invoices, the authorities themselves had noted that the single invoice carried an annexure listing them, and the appellant said all were available. The Bench saw no reason to deny it the chance to produce them.

The appellant was held entitled to the full credit. It must submit the 81 invoices to the original authority, which must verify them and allow the credit if otherwise in order, within one month.

2026-juristway.com-3163-GSTAT(Chandigarh)-GST