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2022 (1) TMI 703 - HC - GSTRejection of refund application - Validity of Rule 90(3) of Central Goods and Services Tax Rules, 2017 and paragraph 12 of the impugned Circular dated 18th November, 2019 - ultra-vires of Section 54 of the CGST Act or not - seeking a direction to consider the application for refund filed by the petitioner - rejection of refund solely on the ground that the refund application filed after removal of deficiencies was beyond the prescribed period of two years - HELD THAT - Mr. Sahid Hanief, learned counsel accepts notice on behalf of the respondents No.2 to 4. Mr. Satish Kumar, learned counsel accepts notice on behalf of the respondent No.5. List on 17th January, 2022.
Issues:
Challenge to Rule 90(3) of Central Goods and Services Tax Rules, 2017 and paragraph 12 of Circular dated 18th November, 2019 as ultra vires Section 54 of the CGST Act. Refund application rejection based on timing of re-filing after deficiencies noted. Interpretation of Section 54(1) of the CGST Act regarding the limitation period for filing refund claims. Analysis: The High Court heard a writ petition challenging the validity of Rule 90(3) of Central Goods and Services Tax Rules, 2017 and paragraph 12 of a Circular dated 18th November, 2019, contending that they were ultra vires Section 54 of the CGST Act. The petitioner also contested an order from respondent No. 2 in FORM GST RFD-06 dated 13th April, 2021, seeking a direction for the refund application to be considered and decided promptly on its merits. The petitioner argued that the original refund application was timely filed within the two-year limitation period prescribed by Section 54(1) of the CGST Act, despite subsequent deficiencies being rectified through a re-filing of the application. The petitioner emphasized that the initial filing within the prescribed time frame should be the determining factor for the limitation period under Section 54(1) of the CGST Act. The Court issued notice on the matter, with learned counsel for the petitioner highlighting that the rejection of the refund application by respondent No. 2 on the grounds of exceeding the two-year period after rectification of deficiencies was unjustified. The petitioner's counsel contended that the rectified application should not be time-barred if the original submission was within the statutory time limit. The interpretation of Section 54(1) of the CGST Act was crucial in determining the validity of the refund claim's timing and whether subsequent rectifications should affect the application's admissibility. The Court accepted the arguments made by the petitioner's counsel and scheduled further proceedings for 17th January, 2022, to delve deeper into the issues raised in the writ petition alongside a connected case. The case highlighted the importance of adherence to statutory timelines for filing refund claims under the CGST Act and the significance of the initial submission within the prescribed period as per Section 54(1) in determining the application's validity. The judgment showcased the Court's commitment to ensuring procedural fairness and upholding the principles of statutory interpretation in tax matters.
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