2022 (10) TMI 505 - HC - GST

Rejection of refund claim - excess payment of GST - rejection of claim on the ground of time limitation - Section 54 of the Central Goods and Services Tax Act, 2017/Telangana Goods and Services Tax Act, 2017 - HELD THAT - The impugned order is not at all a speaking order. No reasons have been assigned for rejecting the refund application of the petitioner. Respondent No.1 did not advert to the objections filed by the petitioner on 10.03.2022. The matter remanded back to respondent No.1 to pass a fresh order on the refund application of the petitioner dated 14.01.2022 after giving reasonable opportunity of hearing to the petitioner, including personal hearing. Let the said exercise be completed within a period of three months from the date of receipt of a copy of this order - petition disposed off.

Summary

Issues:
1. Quashing of order rejecting refund application
2. Excess payment of tax by the petitioner
3. Barred by limitation under Section 54 of CGST Act, 2017/Telangana GST Act, 2017
4. Lack of reasoning in the impugned order
5. Remand of the matter for a fresh order

Analysis:
The petitioner filed a writ petition seeking the quashing of an order rejecting their refund application for the period from July 2017 to March 2018, totaling Rs. 88,89,113.00. The petitioner, engaged in the textile and readymade garments business under GST registration, claimed the refund due to an excess payment of GST during the said period. Respondent No.1 issued a show cause notice citing limitation under Section 54 of the CGST Act, 2017/Telangana GST Act, 2017, proposing to reject the claim. The petitioner objected, asserting that the application was within the time limit, but the respondent still rejected the claim without providing any substantial reasoning, merely stating "delay in refund application."

The High Court, after reviewing the impugned order, found it lacking in reasoning and failing to address the objections raised by the petitioner. Consequently, the Court set aside the order and remanded the matter back to respondent No.1 for a fresh decision on the refund application. The Court directed respondent No.1 to provide a reasonable opportunity of hearing to the petitioner, including a personal hearing, and instructed the completion of the process within three months from the date of the order. The writ petition was disposed of without any costs awarded.

This judgment highlights the importance of providing a reasoned decision while adjudicating refund applications and the necessity of addressing objections raised by the concerned parties. It emphasizes the principle of natural justice and the right to a fair hearing in matters concerning tax refunds under the GST regime.