GSTAT says Section 73 Cannot Recover Inadmissible CENVAT Credit Transitioned Through TRAN-1

Maithan Steel and Power Limited challenged proceedings initiated under Section 73 of the CGST Act to recover allegedly inadmissible CENVAT credit transitioned through TRAN-1. The Department disputed the closing credit carried forward on the basis of ER-1 returns and the unavailed credit claimed on capital goods. The Tribunal held that the dispute concerned the eligibility of CENVAT credit under the erstwhile law, not wrongful availment of input tax credit under the GST enactment. Relying on the Jharkhand High Court decision in Usha Martin and the Calcutta High Court decision in Kunjal Synergies, GSTAT held that the proceedings under Section 73 were beyond the jurisdiction of GST authorities. The appeal was allowed and the appellate order set aside.