2024 (6) TMI 745 - HC - GST

Rejection of Refund of amount paid in excess - difference between the petitioner's GSTR 1 statement and the GSTR 3B return - HELD THAT - It appears that no reasons have been recorded for concluding that the claim does not fall within the ambit of sub-section (1) of Section 77. Even as regards the issue relating to excess payment, while a conclusion is drawn that there is no excess payment, the petitioner's reply in such regard, wherein specific details are set out, was not engaged with and proper reasons were not assigned for the conclusion that there is no excess payment. Consequently, the matter requires re-consideration. Petition disposed off by way of remand.

Summary

Issues involved: Challenge to rejection of refund request u/s GST laws for wrongly claimed Input Tax Credit (ITC) and double payment discrepancy between GSTR 1 and GSTR 3B return.

Summary:

Issue 1: Wrongly claimed ITC under CGST and SGST instead of IGST:
The petitioner challenged the rejection of the refund claim based on the audit observation that ITC was wrongly claimed under CGST and SGST instead of IGST. The petitioner subsequently paid the amounts in question and sought a refund. The impugned order did not provide reasons for rejecting the refund claim, despite the petitioner's contention that the case fell within the scope of relevant GST enactments. The respondent concluded that the refund claims did not fall within the specified section, but failed to adequately respond to the petitioner's submissions and reasons for the claim. The High Court held that proper reasons must be recorded for such conclusions and remanded the matter for reconsideration, directing the respondent to provide a reasonable opportunity to the petitioner for a fresh decision.

Issue 2: Double payment discrepancy between GSTR 1 and GSTR 3B return:
The petitioner also raised the issue of a double payment made in relation to the difference between GSTR 1 statement and GSTR 3B return for July 2020. The petitioner provided details of the double payment in response to a show cause notice, but the reasons for rejecting the refund claim were not adequately provided. The High Court found that the matter required re-consideration as proper reasons were not assigned for the conclusion that there was no excess payment. Consequently, the impugned order was set aside, and the case was remanded for a fresh decision within two months, with the directive to provide the petitioner with a reasonable opportunity, including a personal hearing.

In conclusion, the High Court disposed of the writ petition on the above terms, without imposing any costs, and closed the related miscellaneous petition.