2024 (2) TMI 56 - HC - GST

Refund of IGST - Ocean Freight - HELD THAT - In the case of UNION OF INDIA ANR. VERSUS M/S MOHIT MINERALS PVT. LTD. THROUGH DIRECTOR 2022 (5) TMI 968 - SUPREME COURT , Hon ble Supreme Court, inter alia observed and directed The impugned levy imposed on the service aspect of the transaction is in violation of the principle of composite supply enshrined under Section 2(30) read with Section 8 of the CGST Act. Since the Indian importer is liable to pay IGST on the composite supply , comprising of supply of goods and supply of services of transportation, insurance, etc. in a CIF contract, a separate levy on the Indian importer for the supply of services by the shipping line would be in violation of Section 8 of the CGST Act. The writ petition filed by the petitioner is disposed of in the light of the judgment in the case Mohit Minerals - The petitioner would be entitled to refund of the IGST paid by it. Needful be done by the respondents within a period of six weeks from the date of this order, in accordance with law.

Summary

Issues involved:
The writ petition seeks to quash specific notifications and orders related to GST, claiming refund and interest, based on the judgment of the Supreme Court in Union of India Vs. Mohit Minerals (Pvt.) Limited.

Quashing of Notifications and Orders:
The petitioner requested the quashing of various notifications and orders related to GST, citing the judgment in Union of India Vs. Mohit Minerals (Pvt.) Limited. The High Court observed that the issue raised in the petition aligns with the Supreme Court's judgment, indicating that the reliefs sought by the petitioner are valid. The submissions made by the petitioner's counsel were undisputed by the respondents' counsel.

Observations and Directions of the Supreme Court:
In the case of Mohit Minerals (Pvt.) Limited, the Supreme Court highlighted the erroneous implementation of GST due to misconceptions in the legislation. The Court emphasized that levying additional taxes on components of supply, already covered under GST, is impermissible. The Court concluded that the notifications imposing tax on services, already included in the composite supply of goods, are illegal and should be struck down. The recommendations of the GST Council were deemed non-binding on the Union and States, emphasizing the collaborative nature of decision-making in GST matters.

Disposition of the Writ Petition:
Based on the alignment of the petitioner's case with the Mohit Minerals judgment, the High Court disposed of the writ petition in favor of the petitioner. The petitioner was granted the refund of the IGST paid, with instructions for the respondents to process the refund within six weeks from the date of the order, in compliance with the law.