2022 (3) TMI 734 - HC - GST

Sanction of interest amount accrued owing to the delay caused in processing the Refund Applications - non-disbursal of balance SGST portion of the sanctioned refund - HELD THAT - The Court does not find any justification in keeping the writ petition pending and deems it appropriate that a direction be issued for such payment. The respondents no.1 and 3 are directed to ensure payment of ₹ 1,44,65,283/- as per Form GST RFD-06, dated 12.01.2021 under the signature of the respondent no.3 to the petitioner within a period of four weeks from the date of production of the copy of order before the 3rd respondent as per Section 56 of the Central Goods and Services Tax Act, 2017 - Petition disposed off.

Issues:
1. Delay in processing refund applications and interest accrued.
2. Non-disbursal of balance SGST portion of the sanctioned refund.
3. Entitlement of the petitioner to refund of tax amount.
4. Justification for keeping the writ petition pending.
5. Direction for payment and statutory interest.

Analysis:

1. Delay in Processing Refund Applications and Interest Accrued:
The petitioner sought a declaration of the actions of the respondents as illegal, arbitrary, and in violation of GST Acts for not sanctioning the interest amount accrued due to delays in processing refund applications. The Court acknowledged the entitlement of the petitioner to the refund of tax amount and noted that the matter was pending at the CFMS level for actual payment. Consequently, the Court found no justification in keeping the writ petition pending and directed the respondents to ensure payment of the disputed amount within a specified period.

2. Non-Disbursal of Balance SGST Portion of the Sanctioned Refund:
The petitioner also challenged the non-disbursal of the balance SGST portion of the sanctioned refund, alleging it to be illegal, arbitrary, and in violation of GST Acts. The Court directed the respondents to disburse the balance SGST portion of the tax amount along with applicable interest for the delayed refund till the date of actual payment. This direction was issued to ensure compliance with the provisions of the law and to rectify the alleged wrongful withholding of the refund amount.

3. Entitlement of the Petitioner to Refund of Tax Amount:
It was established that the petitioner was entitled to the refund of the tax amount mistakenly paid in the State of Andhra Pradesh. The Court recognized this entitlement and emphasized the need for prompt action to facilitate the refund process. The respondents were directed to make the necessary payments in accordance with the relevant provisions of the Central Goods and Services Tax Act, 2017, within a specified timeframe.

4. Justification for Keeping the Writ Petition Pending:
Given the undisputed entitlement of the petitioner to the refund and the pending status of the matter at the CFMS level, the Court found no valid reason to prolong the writ petition. The Court, therefore, decided to issue a clear direction for the payment of the refund amount, emphasizing the importance of timely resolution of such disputes to uphold the principles of natural justice and legal obligations.

5. Direction for Payment and Statutory Interest:
In conclusion, the Court disposed of the Writ Petition, directing the respondents to ensure the payment of the disputed amount along with statutory interest within a specified period. This directive aimed to enforce compliance with the legal provisions governing refunds and to uphold the rights of the petitioner to receive the refund promptly and in accordance with the law.

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