2022 (8) TMI 688 - HC - GST

Refund of IGST on ocean freight charges with interest - prohibition on respondent authorities from collecting the IGST in terms of N/N. 10 of 2017 - Integrated Tax (Rate) dated 28.6.2017 and N/N. 8 of 2017 Integrated Tax (Rate) of even date read with corrigendum dated 30.6.2017 - HELD THAT - Notification Nos. 8 of 2017 and 10 of 2017 both dated 28.6.2017 read with corrigendum dated 30.6.2017 came up for consideration for their validity before this court - This court in MOHIT MINERALS PVT LTD VERSUS UNION OF INDIA 1 OTHER 2020 (1) TMI 974 - GUJARAT HIGH COURT held the said notifications to be unconstitutional and ultra vires the statute. The above position and law emanating from the decision of this court in Mohit Minerals Pvt. Ltd. could not be disputed by learned advocates for the respective parties. It is directed that if any IGST amount is collected, the same shall be refunded within six weeks alongwith statutory rate of interest - Petition allowed.

Summary

Issues:
1. Refund of Integrated Goods and Services Tax (IGST) on ocean freight charges.
2. Validity of Notification No. 8 of 2017 and Notification No. 10 of 2017.
3. Previous judgments on the constitutionality of the notifications.
4. Direction for refund of IGST paid pursuant to the notifications.

Analysis:

Issue 1: The petitioner, a private limited company engaged in processing edible oils and coffee, sought a refund of IGST calculated on ocean freight charges and requested to prohibit the collection of IGST as per specific notifications.

Issue 2: Notifications No. 8 of 2017 and No. 10 of 2017, along with a corrigendum, imposed IGST on inter-state supply of services and transportation of goods by vessel. The validity of these notifications was challenged in light of their constitutionality.

Issue 3: Previous judgments, including Mohit Minerals Pvt. Ltd. vs. Union of India, declared the notifications unconstitutional and ultra vires the statute. Other cases like Gokul Agro Resources Ltd. vs. UOI and Bharat Oman Refineries Ltd. vs. Union of India also supported this decision.

Issue 4: In a similar case, ADI Enterprises vs. Union of India, the court directed the refund of IGST paid under Notification No. 10 of 2017. The court emphasized the unconstitutionality of Entry No.10 of the notification and ordered the refund with statutory interest.

Conclusion: Considering the precedents and the unconstitutionality of the notifications established in previous cases, the present petition was allowed. The court directed the refund of any collected IGST amount within six weeks, along with statutory interest, in line with the decisions in similar cases.