2019 (9) TMI 450 - HC - GST

Rejection of refund claim - refund rejected by a one line communication without disclosing any reason for the rejection - HELD THAT - The rejection order has been passed without hearing the Petitioner and without recording any reasons for the rejection, that too in the face of the refund sanctioned by the Respondent. Thus, we consider it appropriate to direct Respondent No. 4 (Principal Chief Commissioner) and Respondent No. 5 (Special Commissioner, Delhi GST) to remain personally present in Court with the complete record relating to Petitioner s case, to explain as to why the refund, which had earlier been sanctioned, has now been rejected. List on 06.09.2019.

Summary

Issues Involved:
1. Rejection of refund without providing reasons
2. Entertaining a writ petition despite statutory remedy
3. Directing officials to explain refund rejection

Issue 1: Rejection of refund without providing reasons
The petitioner claimed that the refund sanctioned to them was later rejected without any explanation. The court acknowledged that ordinarily, a writ petition would not be entertained at this stage due to the availability of statutory remedies. However, the court decided to entertain the petition due to the lack of reasons provided for the rejection, especially after the refund had been initially sanctioned. The court directed the concerned officials to appear personally in court with all relevant records to clarify the reasons behind the rejection and instructed them to provide a time-bound refund if the rejection was unjustified. No adjournment was allowed, and the matter was listed for a specific date.

Issue 2: Entertaining a writ petition despite statutory remedy
The court noted that typically, in cases where an assessee has a statutory remedy available, a writ petition would not be entertained. However, in this instance, the court decided to entertain the petition due to the peculiar circumstances surrounding the rejection of the refund without proper justification. The court emphasized the importance of due process and fairness in administrative actions, leading to the decision to proceed with the writ petition despite the availability of statutory remedies.

Issue 3: Directing officials to explain refund rejection
The court directed the Principal Chief Commissioner and the Special Commissioner of Delhi GST to personally appear in court with all relevant documentation related to the petitioner's case. The purpose of their appearance was to provide an explanation as to why the initially sanctioned refund was subsequently rejected without proper reasoning. The court set an expectation for the officials to be prepared to justify the rejection and to provide a time-bound refund if the rejection was deemed unjustified. Additionally, the court emphasized that no adjournments would be granted, indicating the urgency and importance attached to resolving the issue promptly.

This judgment highlights the court's commitment to ensuring transparency, fairness, and accountability in administrative decisions, particularly concerning the rejection of refunds without adequate justification. The court's decision to entertain the writ petition despite the availability of statutory remedies underscores the significance of upholding due process and addressing instances of arbitrary or unexplained actions by authorities. The directive for officials to personally appear and account for their decision reflects the court's proactive approach in safeguarding the rights of the petitioner and ensuring a timely resolution to the dispute.