JUDGMENT :

Heard Mr V Jayanandakumar, a very eminent Counsel of this Court, for the petitioner, Mr P.R. Sreejith, learned Standing Counsel for the GST Department, and Ms Rasmitha Ramachandran, learned Government Pleader for the State.

2. The present writ petition under Article 226 of the Constitution of India has been filed by the petitioner questioning the Ext.P6 order, whereby the petitioner’s claim for treating the TDS on outward supply has not been treated as the input tax credit for the purposes of giving transitional credit to the petitioner to an extent of Rs.59,05,352/-.

3. The petitioner was registered as a dealer under the provisions of the Kerala Value Added Tax Act, and on the advent of the GST regime, transitioned to the provisions of CGST/SGST Act 2017, the petitioner got registered as a dealer under the provisions of the CGST/SGST Act. The petitioner filed TRAN-1 on 14.11.2022 and claimed credit of Rs.59,05,352/- under the SGST Act through table 5 (c) as per Section 140(1) of the SGST Act 2017. This amount of Rs.59,05,352/- was the TDS amount deducted from the contract amount. Notice dated 15.02.2023 was issued to the petitioner in respect of the said claim. The petitioner filed a reply, and after giving an opportunity of hearing to the petitioner, the said claim for giving input tax credit of Rs.59,05,352/-, i.e., the TDS amount, was declined and rejected.

3.1 The Assessing Authority has been of the view that the TDS amount remitted by the contractor of the petitioner can only be claimed through a refund application, such amount is ineligible to be transitioned to GST regime credit, and such amount cannot be claimed in TRAN-1 as credit. The petitioner/assessee may file an application under Section 142(3) of the SGST/CGST Act 2017 for a refund, but the TDS is not an input tax credit for which the provision of Section 140 is applicable as transitional credit under the GST regime.

3.2 Section 2(62) and 2(63) defines ‘input tax’ and ‘input tax credit’ as under:

“2. Definitions.—

In this Act, unless the context otherwise requires,–

………

(62) “input tax” in relation to a registered person, means the central tax, State tax, integrated tax or Union territory tax charged on any supply of goods or services or both made to him and includes—

(a) the integrated goods and services tax charged on import of goods;

(b) the tax payable under the provisions of sub-sections (3) and (4) of section 9;

(c) the tax payable under the provisions of sub-sections (3) and (4) of section 5 of the Integrated Goods and Services Tax Act;

(d) the tax payable under the provisions of sub-sections (3) and (4) of section 9 of the respective State Goods and Services Tax Act; or

(e) the tax payable under the provisions of sub-sections (3) and (4) of section 7 of the Union Territory Goods and Services Tax Act, but does not include the tax paid under the composition levy; (63) “input tax credit” means the credit of input tax;”

For claiming an amount as input tax credit, the said amount should fall within the definition of ‘input tax’ and ‘input tax credit’ as defined under Sections 2(62) and 2(63).

3.3 Section 140 of the CGST/SGST Act 2017 facilitates the claim of the transitional input tax credit from the transition of the VAT regime to the GST regime. Section 140 on reproduction would read as under:

“140. Transitional arrangements for input tax credit.—

(1) A registered person, other than a person opting to pay tax under section 10, shall be entitled to take, in his electronic credit ledger, the amount of CENVAT credit of eligible duties carried forward in the return relating to the period ending with the day immediately preceding the appointed day, furnished by him under the existing law within such time and in such manner as may be prescribed:

Provided that the registered person shall not be allowed to take credit in the following circumstances, namely:—

(i) where the said amount of credit is not admissible as input tax credit under this Act; or

(ii) where he has not f