2021 (6) TMI 42 - Commissioner - GST

Refund of IGST paid in excess - excess payment of IGST mistakenly is a deposit or Tax - time limitation - principles of natural justice - Whether excess payment of IGST mistakenly would he consider as a deposit or Tax? - HELD THAT - It is evident that payment made by the appellant by debiting from their ledger against the tax liabilities only. Hence, it may not be termed as deposit rather it is payment of tax only. The amount lying in ledger can only be considered as deposit or amount, further, the appellant has offset their liability in the tax head i.e. in the head of IGST and there is no doubt that the IGST is a Tax in terms of IGST Act, 2017 - the disputed amount paid by the appellant is nothing but it is tax only and it may not be considered as pre-deposit or deposit by any stretch of imagination and further the appellant s contention has not been supported by the provisions of law provided under GST Act or Rules. Whether application for refund filed by the appellant is time barred in terms of Section 54 of the CGST Act, 2017 or not? - HELD THAT - Any kind of refund s governed by Section 54 of CGST Act read with Rule 89 of CGST Rules, 2017, and procedure for filing of refund application has been given in the said section and rules only. Therefore, refund under Section 77 will also govern under Section 54 of CGST Act, 2017. Accordingly, period for filing of refund in such cases will be apply as per Section 54 and relevant date will also be taken as per this provisions only - contention of the appellant that the time limit has not been provided in Section 77 of CGST Act read with Section 19 of IGST Act, 2017 for filing of refund application is not acceptable. Whether principle of natural justice has been fallowed in the instant case or not? - HELD THAT - Proper officer has issued show cause notice in Form of GST RFD-08 and personal hearing was also granted by him to the appellant - On perusal of the screen shot of the portal it is found that the show cause notice as well as rejection order were communicated to the appellant through common portal. Further the same fact was also intimated to the appellant vide letter dated 12-6-2020 by the jurisdictional Asstt. Commissioner. The rejection of the refund application of the appellant on the time barred ground is correct and proper - Appeal dismissed - decided against appellant.

Issues Involved:
1. Whether excess payment of IGST mistakenly would be considered as a deposit or tax.
2. Whether the application for refund filed by the appellant is time-barred in terms of Section 54 of the CGST Act, 2017.
3. Whether the principle of natural justice has been followed in the instant case.

Detailed Analysis:

Issue 1: Whether excess payment of IGST mistakenly would be considered as a deposit or tax.

The appellant argued that the excess IGST paid for September and October 2017 should be considered a deposit rather than a tax. The appellant's contention was rejected. The adjudicating authority found that the appellant had offset his liabilities for the said months by debiting from the Cash or Credit ledger and filed GSTR-3B accordingly. Therefore, the payment was considered a tax, not a deposit. The adjudicating authority stated, "the disputed amount paid by the appellant is nothing but it is tax only and it may not be considered as pre-deposit or deposit by any stretch of imagination."

Issue 2: Whether the application for refund filed by the appellant is time-barred in terms of Section 54 of the CGST Act, 2017.

The appellant contended that the excess IGST paid was in the nature of a deposit and should be refunded without attracting the limitation clause. The adjudicating authority referred to Section 54 of the CGST Act, which mandates that a refund application must be filed within two years from the relevant date. The relevant date for the tax period of September and October 2017 was 20th November 2019, but the appellant filed the refund application on 11th February 2020, beyond the stipulated two-year period. The adjudicating authority concluded, "refund application should have been filed for the said tax period up to 20th November 2019 while the appellant filed the refund application on 11-2-2020 which is clearly beyond two years from the relevant date as prescribed under Section 54(14) of the CGST Act."

The appellant also argued that the refund claim should be governed by Section 19 of the IGST Act read with Section 77 of the CGST Act, which do not prescribe any time limit for refund. The adjudicating authority rejected this argument, stating that any kind of refund is governed by Section 54 of the CGST Act read with Rule 89 of the CGST Rules, 2017. Therefore, the period for filing a refund in such cases will apply as per Section 54, and the relevant date will also be taken as per these provisions.

Issue 3: Whether the principle of natural justice has been followed in the instant case.

The appellant argued that they were not given an opportunity to be heard and that the copy of the order (RFD-06) was not communicated by the adjudicating authority. The adjudicating authority found that the proper officer had issued a show cause notice in Form GST RFD-08 and granted a personal hearing. The appellant submitted a reply in Form GST RFD-09. The adjudicating authority noted that the show cause notice and rejection order were communicated to the appellant through the common portal, and this was also intimated to the appellant via a letter dated 12-6-2020. The adjudicating authority concluded, "I do not find any merits of the appellant in this regard."

Conclusion:

The adjudicating authority upheld the rejection of the refund application on the grounds of being time-barred and confirmed that the excess IGST paid was considered a tax, not a deposit. The principle of natural justice was deemed to have been followed as the show cause notice and rejection order were communicated through the common portal. Consequently, both appeals filed by the appellant were rejected.

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