2024 (2) TMI 1361 - HC - GST

Refund of the amount of tax deposited by him on the cancelled (old) registration - inadvertent / bona fide error on the part of the Petitioner s Chartered Accountant in filing the returns and depositing tax under a cancelled registration number - HELD THAT - It was required to be considered by the authorities below that an assessee cannot be expected to file his return and deposit any tax under an invalid cancelled registration number. Further, a legitimate and proper return was filed by the Petitioner under the second (new) registration which was a valid registration. Thus, insofar as the tax deposited under the first (cancelled) registration is concerned, the said registration itself being non-existent, the tax return filed thereunder and any tax deposited under such return, could not have been retained by the respondents as it was not a deposit as per law, it also cannot be a deposit received or any collection of tax under authority of law. Insofar as the second registration return is concerned, the same was appropriately filed and similar amount of Rs. 1,22,220/- was deposited. In these circumstances, it was not correct for the original authority to furnish the reasons, as noted, so as to deny the refund claim of the Petitioner. Further, the appellate authority on a purely technical reason that the Petitioner s appeal was barred by limitation under Sections 107 (1) and (4) rejected the Petitioner s appeal. It is observed that, in such circumstances, any deficiency in filing the appeal / application like failure to file physical documents, cannot make the appeal, which was registered on the online portal within the prescribed period of limitation, to be labelled and/or held to be barred by limitation. Once the appeal was filed (albeit under the Online method) within the prescribed limitation, any deficiency in the appeal certainly could be removed later on, as the law does not provide, that the proceeding be strictly filed sans deficiency, and only then, the proceedings would be held to be validly filed. If such proposition is to be recognized as the correct position, it would not only tantamount to a patent absurdity, but also would result in a gross injustice, prejudicially affecting the legitimate rights of persons to a legal remedy (access to justice). Impugned order dated 8th June 2022, as confirmed by the order dated 27th February 2023 passed by the Assistant Commissioner, CGST and Central Excise, Division-I, Navi Mumbai, Commissionerate are quashed and set aside - Petitioner is entitled to refund of the amounts which was deposited by him under the erroneous return filed under the cancelled registration No. 27AQEPM6029PIZA being an amount of Rs. 1,22,220/- - petition allowed.

Summary

Issues:
The judgment involves a Petition under Article 226 of the Constitution of India challenging an order rejecting a refund application for tax deposited under a cancelled GST registration number.

Summary:
The Petitioner, a scriptwriter, had two GST registration numbers, one cancelled and one new. The Petitioner's Chartered Accountant mistakenly deposited tax under the cancelled registration number, leading to a refund application rejection. The Assistant Commissioner and the appellate authority rejected the claim based on procedural grounds, stating the appeal was filed beyond the limitation period. The High Court found that the tax deposited under the cancelled registration was not valid and ordered a refund of the amount deposited under the cancelled registration number.

The Court held that the Petitioner was entitled to a refund as the tax deposited under the cancelled registration was not legally valid. The authorities failed to consider that the Petitioner's first registration was cancelled, and the tax return filed under it was void. The appellate authority's hyper-technical view on the limitation period for filing the appeal was deemed incorrect. The Court emphasized that procedural deficiencies should not bar a validly filed appeal within the limitation period. The judgment quashed the previous orders and directed the refund of the tax amount deposited under the cancelled registration number, along with interest, within four weeks.