2022 (7) TMI 1398 - HC - GST

Refund claim u/s 54 of CGST Act - appeal dismissed only on the ground that requisite documents were not submitted at the adjudicating stage - HELD THAT - Without entering into the dispute as to whether the petitioner/assessee was intimated as to the documents which are necessary to be submitted for claiming refund, this Court is of the considered view that the appellate authority ought to have taken note of the documents which were filed by the petitioner/assessee before the appellate authority in support of his claim for refund. Such finding is supported by the reasons assigned hereinafter. Rule 112 (1) of the Central Goods and Services Rules, 2017 (for short, CGST Rules, 2017 ) permits an appellant to produce additional evidence before the appellate authority under certain circumstances. Sub-Rule (4) of Rule 112 starts with a non-obstante clause and provides that nothing contained in Rule 112 shall affect the power of the appellate authority to direct the production of any document or the examination of any witness to enable it to dispose of the appeal. Thus, the appellate authority has the power to permit the appellant to produce documents which will enable it to dispose of the appeal effectively - the learned Advocate for the respondents also could not satisfy this Court that the documents produced by the petitioner before the appellate authority are not necessary for the effective disposal of the appeal. The appellate authority, in the considered view of the Court, failed to exercise the jurisdiction vested in him by law in refusing to consider the documents filed by the petitioner/assessee before the appellate authority. Impugned order set aside - appeal allowed.

Summary

Issues:
1. Writ of Mandamus for setting aside orders rejecting refund claim.
2. Lack of deficiency memo served to petitioner.
3. Dismissal of appeal due to missing documents.
4. Appellate authority's failure to consider documents submitted.
5. Jurisdiction of appellate authority to direct production of documents.

Analysis:
The petitioner sought a writ of Mandamus to challenge the orders passed by the Assistant Commissioner and Additional Commissioner of CGST and Central Excise, rejecting the refund claim under Section 54 of the CGST Act, 2017. The petitioner argued that no deficiency memo was served, hindering the submission of required documents. On the other hand, the respondent authorities contended that a specific procedure exists for claiming refunds, emphasizing the need for documents at the adjudication stage. The petitioner's failure to demonstrate sufficient cause for not submitting documents earlier led to the appeal's dismissal by the appellate authority.

The High Court noted that the appellate authority should have considered the documents submitted by the petitioner in support of the refund claim, irrespective of prior deficiencies. Rule 112(1) of the CGST Rules allows for additional evidence under certain circumstances, empowering the appellate authority to direct document production. The court highlighted that the appellate authority's failure to assess the necessity of these documents for the appeal's disposal was a critical oversight.

Despite the respondent's inability to establish the documents' irrelevance, the appellate authority neglected its duty by not considering the petitioner's submissions. Consequently, the High Court set aside and quashed the order of the Additional Commissioner, directing a rehearing of the appeal with due consideration of the filed documents. The court instructed an expeditious disposal, preferably within four weeks, emphasizing the importance of a fair hearing and document evaluation in the appellate process.

In conclusion, the High Court allowed the petition, providing directions for the rehearing of the appeal without imposing any costs. The parties were advised to promptly obtain a certified copy of the order upon fulfilling legal requirements, ensuring efficient compliance with the court's directives.