2019 (5) TMI 1510 - HC - GST

Filing of manual applications for refund - Constitution of Refund Approval Committee for considering high value refunds - HELD THAT - The Court is informed that the RAC has since been reconstituted and a new set of officers have been nominated as RAC. They are Mr.Vinay Kumar, Spl. Commissioner/Chairperson; Ms.Sonika Singh, Spl. Commissioner; Mr.Saumyaketu Mishra, Joint Commissioner and Ward Incharge concerned, Member Secretary. The Court is informed that of the above 4 officers Ms.Sonika Singh is already on leave for 19 days till 7th June 2019 (effectively till 9th June 2019) and Mr.Vinay Kumar is on election duty at the 15th Balaghat parliamentary constituency. This effectively means that even though the RAC has been reconstituted it cannot function at all for some time. Mr. S.B.Shashank, Chairperson and Mr. Rajesh Goel, Addl. Commissioner who were part of the RAC when it met on 10th May 2019 will remain present in Court on the next date. They are permitted to file, by that date, their individual affidavits explaining why they should not be proceeded against for disobedience of the orders of this Court. Mr. H. Rajesh Prasad, Commissioner, VAT will remain personally present before the Court on the next date. He will by the next date file an affidavit explaining on what basis he has constituted and re-constituted the RAC and how it can possibly supplant the officer concerned who is statutorily empowered to pass orders of refund under the CGST Act and Rules. On or before the next date of hearing, the provisional refund due to the Petitioners in W.P. (C) Nos. 13881 of 2018 and 194 of 2019 in terms of Rule 91 of the CGST Rules will be paid to each of them. Since Smt.. Sonika Singh is stated to be on leave and at present out of India, Mr. H.Rajesh Prasad will ensure that a copy of this order is immediately communicated to her by e-mail and she is apprised that as soon as she returns from leave she is required to file an affidavit explaining her conduct. List on 29th May 2019.

Summary

Issues:
1. Failure to grant refunds in multiple petitions.

Analysis:
The High Court of Delhi addressed three petitions concerning the failure of the Respondents to grant refunds. In WP(C) 9161/2018, although a refund was issued, other issues such as interest remained to be considered. In WP(C) 13881 of 2018 and WP(C) 194 of 2019, despite previous orders by the Court, refunds had not been granted. The Court had granted liberty for manual refund applications within a two-year period, leading to the rejection of an application in WP(C) 13881/2018 due to incorrect filing procedures. The Court highlighted Rule 97 A of the CGST rule, allowing manual filing and processing, which the officer had overlooked. Consequently, the Court set aside the rejection order and directed a fresh examination of the manual refund application.

In a subsequent hearing, the Court was informed about the delay in refund approval by the Refund Approval Committee (RAC). Despite the Court's directions, no provisional refund was issued, leading to a clear disobedience of orders. The Court expressed dissatisfaction with the RAC's actions and issued notices to the members present on the specified date, including the Chairperson, Special Commissioner, and Addl. Commissioner, for explanation. The RAC was reconstituted with new officers due to the non-compliance issue. The Court also questioned the legal basis of the RAC's existence under the CGST Act and Rules.

Further directions were issued, requiring the presence of specific officers in court to explain their actions and decisions. The Court emphasized the need for prompt payment of provisional refunds to the concerned Petitioners. Additionally, the Commissioner VAT was summoned to explain the basis of constituting and reconstituting the RAC. The Court scheduled the next hearing for a comprehensive review of the situation and compliance with its directives.

In conclusion, the Court highlighted the recurring issue of non-compliance with statutory provisions regarding refunds and expressed concerns over the effectiveness of the RAC. The Court's detailed directions aimed to address the delays and ensure accountability for the failure to adhere to its orders and statutory requirements.