2021 (9) TMI 616 - HC - GST

Refund of the entire amount on deposit made by the petitioner/assessee - Rule 90(2) of the Central Goods and Services Tax Rules, 2017 - HELD THAT - The facts being undisputed, at this stage itself, no useful purpose may be served in keeping the present petition pending or calling for a counter affidavit. Once the basic facts are admitted to the revenue authorities being entitlement of refund arising from the appeal order dated 08.01.2021 and it is also not disputed that the petitioner had filed application for refund through online mode, it was for the revenue authorities to scrutinize the same and inform the assessee in real time, of any defect in that application - upon scrutiny, the acknowledgment on Form GST-RFD-02 was issued acknowledging the claim filed by the petitioner. The revenue authorities also cannot deny existence of the appeal order dated 08.01.2021. Their further conduct to decline the refund on the reasoning or excuse of the application being incomplete, does not inspire confidence. In a case such as this where the refund claim has arisen solely on the strength of the appeal order, unless the assessing authority may plead ignorance of the same, we also cannot remain unmindful of the fact, while rejecting such claims, the authorities are forcing the assessee to litigate and also defeating the claim of interest that is otherwise due on account of delay in processing the refund application. Petition allowed.

Summary

Issues:
Seeking quashing of multiple orders and notice related to refund application rejection.

Analysis:
The petitioner filed a petition seeking to quash orders and a notice related to the rejection of a refund application. An appeal authority had previously allowed the petitioner's appeal and directed a refund of the deposited amount. The order of the appeal authority had attained finality. The petitioner applied for a refund of ?15 lacs, which was acknowledged through Form GST-RFD-02. The petitioner argued that the rejection of the refund claim was improper as the application was complete and the appeal order was final. The court noted that the acknowledgment was issued, and the appeal order was not disputed. The revenue authorities' refusal to grant the refund citing incompleteness of the application was deemed unjustified. The court emphasized that the authorities should have informed the petitioner of any defects in real time during scrutiny. The rejection of the claim forced the petitioner to litigate and deprived them of interest due to delays in processing the refund application. The court allowed the writ petition, setting aside the previous orders and directing the authorities to reconsider the refund application. If a refund is found due, it should be paid to the petitioner with statutory interest for the pending period. The Commissioner of CGST and UPGST were instructed to issue appropriate directions to the concerned authorities promptly.

This detailed analysis covers the issues involved in the judgment comprehensively, highlighting the key legal arguments and the court's reasoning behind the decision.