2021 (7) TMI 429 - HC - GST

Refund of Input Tax - rejection on the ground that there was a mismatch between the export value and the net ITC when compared to monthly returns - inadvertent omission to take into account two invoices relating to the month of March - personal hearing not afforded to the petitioner - principles of natural justice - HELD THAT - The impugned order, is non-speaking. In fact, there is a column available for reasons on the basis of which the claim has been either accepted or rejected. However, this column in the impugned order is conspicuously blank and no reasons have been adduced for the rejection of the request. Bearing in mind the violation of principles of natural justice, the impugned order of rejection is set aside. The petitioner will appear before the respondent on Monday, the 19th of July, 2021 at 10.30 a.m. without expecting any further notice in this regard - Petition disposed off.

Summary

Issues involved: Challenge to order rejecting refund claim under Goods and Services Tax Act, 2017.

The judgment addresses the challenge to an order dated 22.07.2020 rejecting a refund claim under the Goods and Services Tax Act, 2017. The petitioner, a registered assessee, had made a claim for refund of Input Tax, which was initially met with a deficiency memo from the respondent requesting supporting documents. Despite the petitioner's response to a subsequent show cause notice, the refund claim was rejected based on a mismatch between export value and net ITC as per monthly returns. The petitioner argued that the omission of two invoices for March 2020 led to the discrepancy, a point that could have been clarified if a personal hearing had been granted before the order. The court noted the non-speaking nature of the impugned order, lacking reasons for rejection and failing to adhere to principles of natural justice, leading to setting aside of the rejection order.

The court emphasized the importance of affording a personal hearing before adjudication of a refund claim, highlighting that the petitioner's explanation regarding the omitted invoices could have been presented effectively in such a hearing. The non-speaking nature of the impugned order, with a blank column for reasons, was deemed a violation of principles of natural justice, warranting the order's setting aside. Consequently, the petitioner was directed to appear before the respondent for a personal hearing, following which the respondent was instructed to pass a new order on the refund claim within four weeks, ensuring compliance with the law.

In conclusion, the Writ Petition challenging the order rejecting the refund claim was disposed of, with the rejection order being set aside due to procedural irregularities and lack of reasoning. The petitioner was granted the opportunity for a personal hearing to clarify the discrepancy in the claim, and the respondent was directed to issue a fresh adjudication order within a specified timeframe. No costs were awarded, and connected Miscellaneous Petitions were closed as the matter was resolved through the judgment.