2020 (10) TMI 802 - Commissioner - GST

Refund of unutilized ITC - rejection on the ground that the address of the recipient is not mentioned on the invoices of M/s Adinath Industries - HELD THAT - GSTIN of the recipient is not mentioned on the invoice of M/s OM Metals Auto Pvt Ltd. On the invoice of M/s Shri Sanwariya Trading Company, Fatehnagar also the address of recipient is not mentioned, Invoices submitted in reply to the deficiency memo are not acceptable as the details of address and GSTIN were not present on the invoices at the time of filing of refund claim and on the invoices submitted in reply to the deficiency memo the details of address and GSTIN have been typed later on the same original invoice copies. Thus, the appellant has contravened the provisions the Rule 46 and the Notification No.39/2018- Central Tax, dated 04.09.2018. The appellant has stated that now the invoices have already been rectified by the suppliers on the request of the appellant and the copies of the same have also been annexed with the appeal memo thus thereby complied Rule 46 of the CGST Rules, 2017. Refund claim rejected on payment voucher not provided by the assessee for the RCM invoice - HELD THAT - As per the second proviso to Section 16 of the CGST Act. the recipient of supply will not lose the ITC of the tax paid under RCM even if payment to the supplier is not made within 180 days of the supplies - Circular No. 37/11/2018-GST dated 15/03/2018 has been issued to clarify. various issue in relation to processing of claims for refund. In para 15 of the circular it is stated that it is also advised that refunds may not be withheld due to minor procedural lapse or non-substantive errors or omission-and requested for not to withheld refund claim due to minor procedural lapse or non-substantive errors or omission - the export related refunds should not be rejected due to minor procedural lapse or non-substantive errors or omission which can be rectified subsequently. The appellant is directed to submit the original rectified invoices duly authenticated by the suppliers before the adjudicating authority for verification who may sanction the refund involved therein if the same is found in order and admissible otherwise. Appeal disposed off.

Issues Involved:
1. Non-speaking order by the adjudicating authority.
2. Rejection of refund claim based on assumptions and lack of evidence.
3. Rejection of refund claim due to improper documents issued by the supplier.
4. Minor procedural lapses in refund claim processing.
5. Rejection of refund claim due to non-submission of payment voucher for RCM invoice.

Issue-wise Detailed Analysis:

1. Non-speaking Order by the Adjudicating Authority:
The appellant contended that the adjudicating authority issued a non-speaking order dated 10.12.2018 without appreciating the documents available on record and the provisions of GST law. The appellant emphasized that the order violated the principle of judicial discipline and lacked detailed reasoning.

2. Rejection of Refund Claim Based on Assumptions and Lack of Evidence:
The appellant argued that part of the refund claim was rejected merely on presumption and assumption. The appellant highlighted that the revenue did not discharge the onus to prove the allegations against them, referencing relevant provisions of the Indian Evidence Act, 1872, and the Indian Penal Code, 1860.

3. Rejection of Refund Claim Due to Improper Documents Issued by the Supplier:
The adjudicating authority rejected the refund claim amounting to ?14,446/- on the grounds that certain invoices did not comply with Rule 46 of the CGST Rules, 2017. The appellant countered this by stating that the invoices had been rectified by the suppliers to comply with the provisions of Rule 46, and copies of the corrected invoices were submitted.

4. Minor Procedural Lapses in Refund Claim Processing:
The appellant cited Circular No. 37/11/2018-GST dated 15.03.2018, which advises that refunds should not be withheld due to minor procedural lapses or non-substantive errors. The appellant argued that the procedural errors in their case did not lead to any irregularity regarding tax paid on inward supplies and thus should not result in the denial of the refund claim. The appellant supported their argument with various case laws, including Mangalore Fertilizers & Chemicals V/s Deputy Commissioner 1991(55) ELT 437 (SC), among others.

5. Rejection of Refund Claim Due to Non-submission of Payment Voucher for RCM Invoice:
The adjudicating authority rejected the refund claim for an amount of ?6,500/- related to an RCM invoice from M/s Tristar Logistics Solutions, citing the absence of a payment voucher. The appellant argued that they had not yet paid the supplier, and the condition of payment within 180 days did not apply to inward supplies covered under the Reverse Charge Mechanism (RCM). The appellant referenced Rule 36(b) of the CGST Rules, 2017, which states that Input Tax Credit on RCM invoices is available at the time of tax payment, and no payment voucher is required.

Conclusion:
After careful consideration of the case records and submissions, the appellate authority found merit in the appellant's contentions. The authority emphasized that export-related refunds should not be rejected due to minor procedural lapses or non-substantive errors that can be rectified subsequently. The appellant was directed to submit the original rectified invoices duly authenticated by the suppliers for verification by the adjudicating authority. If the rectified invoices were found in order and admissible, the refund should be sanctioned accordingly.

Disposition:
The appeal filed by the appellant was disposed of in the manner described above, directing the appellant to provide the necessary rectified documents for further verification and potential sanctioning of the refund.

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