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2024 (8) TMI 954 - HC - GSTRefund claim - rejection on the sole ground of non-compliance of the time limit prescribed under Section 34 (2) of the Central Goods and Services Tax Act, 2017 - HELD THAT - The appellant authority has noted the statement of facts, grounds of appeal, submissions and discussion but in the conclusion at Paragraph No.26 and 27 has dismissed the appeal by simply saying that appellant is not eligible for refund on account of excess payment paid as per provisions of law. Respondent No.1 has noted in the impugned order that one of the grounds of appeal was that Respondent No. 4 while verifying the refund claim has completely mis-interpreted Section 34 (2) of the CGST Act and has applied it erroneously for rejecting the refund claim. Respondent No.1 has also noted that one of the ground is Section 34 (2) of the CGST Act has no relevance to decide the subject application for refund claim of appellants but does not even deal with the same in the impugned order. The order passed by Respondent No. 4 on 1st December 2020 and Respondent No.1 on 28th July 2021 needs to be quashed and set aside - the matter remanded to Respondent No. 4 to consider the refund application applying provisions of Section 54 of the CGST Act on the basis of documents already supplied and keeping in mind the certificate issued by TPL has not been disputed earlier and pass the order in accordance with law. Petition disposed off.
Issues:
Challenge to rejection of refund claim under CGST Act based on time limit non-compliance. Analysis: The petitioner challenged the rejection of a refund claim amounting to Rs. 1,77,495/- by the Joint Commissioner of State Tax (Appeals) based on non-compliance with the time limit prescribed under Section 34(2) of the Central Goods and Services Tax Act, 2017 (CGST Act). The petitioner had invoiced Torrent Pharmaceuticals Limited (TPL) for goods and services in September 2018, but TPL did not make any payment due to non-compliance with the agreement terms. TPL did not account for the invoices or claim Input Tax Credit (ITC) for the supply, as confirmed by a letter from TPL. The petitioner issued credit notes upon realizing TPL's non-acknowledgment of the invoices in February 2020. The petitioner contended that the refund claim fell under Section 54(1) of the CGST Act, allowing refund applications within two years from the relevant date, defined as the date of tax payment. The respondent rejected the claim citing Section 34(2) of the CGST Act, which the petitioner argued was inapplicable as they sought a refund under Section 54. The petitioner submitted the refund application in September 2020, supported by documents, which led to a Show Cause Notice in October 2020. The respondent rejected the application in December 2020 without a personal hearing, citing non-compliance with the time limit under Section 34(2). The petitioner appealed this decision, which was dismissed in July 2021 without proper reasoning. The High Court quashed both the orders and remanded the matter to the respondent to reconsider the refund application under Section 54 of the CGST Act. The court directed a personal hearing for the petitioner and ordered a reasoned and detailed order. The refund, if approved, would include applicable interest as per the CGST Act. The court disposed of the petition, granting relief to the petitioner and providing similar directions for other petitions with similar issues. In conclusion, the High Court's judgment emphasized the correct application of relevant sections of the CGST Act, ensuring procedural fairness and adherence to statutory timelines in refund claims. The court's decision to remand the matter for reconsideration under the appropriate section reflects the importance of procedural compliance and proper adjudication in tax matters.
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