2022 (9) TMI 608 - HC - GST

Rejection of refund alongwith interest - works contract services - whether the request of the Petitioner was accepted or not? - HELD THAT - The Writ Petitions are allowed setting aside the impugned Order, dated 28.05.2022, and the matters are remanded back to the Assistant Commissioner State Tax (1st Respondent herein) to deal with the same afresh after accepting the applications filed by the Petitioner in the month of January 2020, for refund of excess balance in the Electronic Cash Ledger, in accordance with law, by giving an opportunity of hearing to the Petitioner, preferably within a period of six 06 weeks from the date of receipt of the Order. No order as to costs.

Summary

Issues involved:
Challenge to rejection of refund request based on an endorsement issued by the Assistant Commissioner; Interpretation of provisions under CGST Act and SGST Act regarding refund of excess credit in Electronic Cash Ledger; Review of earlier order sanctioning refund; Legal validity of the impugned endorsement; Consideration of technical glitches in the website/portal affecting refund process; Dispute over whether the refund request was accepted or rejected; Remand of the matter for fresh consideration by the Assistant Commissioner.

Analysis:

Issue 1: Challenge to rejection of refund request based on an endorsement issued by the Assistant Commissioner
The Writ Petitions were filed challenging the endorsement issued by the Assistant Commissioner rejecting the request for refund of excess credit in the Electronic Cash Ledger. The endorsement was issued without reflecting any statutory provision, overturning the earlier order approving the refund. The Court found the endorsement lacking statutory basis and set it aside as being bad in law.

Issue 2: Interpretation of provisions under CGST Act and SGST Act regarding refund of excess credit in Electronic Cash Ledger
The Petitioner sought refund under Section 54(1) of the CGST Act for the excess credit lying in the Electronic Cash Ledger. The Respondent rejected the refund request citing non-submission of documents under Section 54(3)(4) of the SGST Act. The Court noted the confusion and emphasized that the Petitioner's case fell under Section 54(1) of the Act, not Section 54(3)(4), and remanded the matter for fresh consideration.

Issue 3: Review of earlier order sanctioning refund
The Respondent claimed that the earlier order sanctioning the refund was erroneous due to non-submission of documents by the Petitioner. However, the Court observed discrepancies in the order, indicating a mistake in the processing of the refund request. The Court directed a fresh consideration of the matter by the Assistant Commissioner.

Issue 4: Legal validity of the impugned endorsement
The Court found the impugned endorsement lacking statutory force and issued without a clear legal basis. It set aside the endorsement as being without legal merit and directed a reconsideration of the refund request.

Issue 5: Consideration of technical glitches in the website/portal affecting refund process
The Court noted the Respondent's claim of technical glitches affecting the refund process but emphasized that such issues should not impede the rightful refund due to the Petitioner. The Court directed a fair and prompt consideration of the refund request without being hindered by technical challenges.

Issue 6: Dispute over whether the refund request was accepted or rejected
The Court highlighted the confusion regarding the acceptance or rejection of the refund request, emphasizing the need for clarity in the decision-making process. It remanded the matter for a fresh determination by the Assistant Commissioner to ensure a transparent and accurate resolution.

Issue 7: Remand of the matter for fresh consideration by the Assistant Commissioner
Ultimately, the Court allowed the Writ Petitions, setting aside the impugned order and remanding the matter to the Assistant Commissioner for a fresh decision. The Court instructed a reconsideration of the refund request in accordance with the law, ensuring the Petitioner's entitlement to the refund of excess credit in the Electronic Cash Ledger.

This detailed analysis of the judgment provides a comprehensive understanding of the issues involved and the Court's decision on each aspect of the case.