2023 (12) TMI 594 - HC - GST

Refund of unutilised Input Tax Credit - rejection on the ground that the petitioner is a SEZ unit and they are not entitled to file any refund application, but only the supplier of service - HELD THAT - Both the learned counsel had referred to the following judgments of this Court, wherein this Court allowed the refund application holding that the SEZ unit is entitled to file the refund application. Reliance placed in PLATINUM HOLDINGS PRIVATE LIMITED VERSUS ADDITIONAL COMMISSIONER OF GST CENTRAL EXCISE (APPEALS-II) , ASSISTANT COMMISSIONER OF GST CENTRAL EXCISE 2021 (10) TMI 630 - MADRAS HIGH COURT and M/S. ATC TIRES PRIVATE LIMITED VERSUS JOINT COMMISSIONER OF GST CENTRAL EXCISE (APPEALS) , ASSISTANT COMMISSIONER OF CGST AND CENTRAL EXCISE, TIRUNELVELI 2022 (4) TMI 1194 - MADRAS HIGH COURT where it was held that The statutory scheme for refund under the CGST and SGST Acts, permits any entity to seek a refund of taxes or other amounts paid under the provisions of the Act, subject to satisfaction that is it so entitled, and that there is no double claim as against the same amount. Ordinarily, though zero rated supplies are not subject to the levy of taxes, the petitioner, in this case has remitted the same as raised in the invoice, albeit erroneously. Therefore, by following the above orders passed by this Court in similar cases, the impugned orders dated 11.05.2023 and 23.03.2023 are set aside and the refund application dated 07.03.2022 filed by the petitioner is allowed. Further, this Court directs the 1st respondent to refund the amount of Rs. 20,32,325/- for the period from April 2020 to March 2021 and Rs. 5,42,614/- for the period from April 2021 to March 2022 along with interest at 6% p.a. to the petitioner within 60 days from the date of receipt of a copy of this order. Petition allowed.

Summary

Issues:
The judgment involves the rejection of a refund application by a petitioner, who is a Special Economic Zone (SEZ) unit, for the assessment years 2020-2021 and 2021-2022, challenging the orders passed by the 1st respondent.

Refund Application Rejection:
The petitioner, a SEZ unit, filed a refund application for unutilised Input Tax Credit due to zero-rated supplies under the IGST Act. The application was rejected by the respondent on the basis that only the supplier of service, not the SEZ unit, is entitled to file the refund application as per Rule 89 of the CGST Rules, 2017.

Legal Arguments:
The respondents contended that as a SEZ unit, the petitioner is not entitled to file the refund application, and only the supplier of the SEZ unit can do so. The rejection of the refund application was justified based on this argument.

Precedent Cases:
Both parties referred to previous judgments of the court where SEZ units were allowed to file refund applications. Citing cases like Platinum Holdings Private Limited vs. Additional Commissioner of GST and Central Excise and M/s. ATC Tires Private Limited vs. Joint Commissioner of GST and Central Excise, the court found precedent for allowing the present writ petitions.

Judgment:
In line with previous court decisions, the High Court set aside the impugned orders and allowed the refund application filed by the petitioner. The 1st respondent was directed to refund specific amounts for the respective periods along with 6% interest per annum within 60 days. The writ petitions were allowed with no costs, and connected miscellaneous petitions were closed.