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2024 (3) TMI 329 - HC - GSTRefund of unutilized Input Tax Credit - Seeking withdrawal of the deficiency memos issued by the respondent in response to the refund claim of the petitioner for the period May, 2019 to July, 2019 - Requirement of furnishing a certificate of the Chartered Accountant - HELD THAT - Admittedly, case of the petitioner is covered under Section 54 (8) (b), which is one of the excepted provisions in the proviso to 89 (2) (l) and (m). Consequently, the deficiency memos issued to the petitioner, requiring the petitioner to furnish a certificate of the Chartered Accountant are not sustainable. They are accordingly set aside. Since part of the amount was denied on account of deficiency memos, which are not found to be sustainable in view of the proviso to Rule 89 (2) (l)(m), it is held that petitioner is entitled to interest on the delayed refund in terms of Section 56 of the Central Goods and Service Tax Act, 2017 at the rate notified by the Government within a period of four weeks from today. As per the petitioner, in view of pendency of the present petition, further claims could not be lodged. Accordingly, on petitioner filing such refund applications, the Department shall not reject the same solely on the ground of limitation. Petition disposed off.
Issues involved:
The issues involved in the judgment are the direction sought by the petitioner for sanctioning the refund claim for a specific period and the withdrawal of deficiency memos issued by the respondent in response to another refund claim. Refund Claim for August 2020 to March 2021: The petitioner sought a direction for the respondent to sanction the refund claim for the period August 2020 to March 2021 and withdrawal of deficiency memos issued for the period May 2019 to July 2019. The respondent had required the petitioner to furnish a certificate by a Chartered Accountant as per the Central Goods and Services Tax Rules, 2017. Interpretation of Circular and Statutory Scheme: The respondent referred to Circular No. 125/44/2019, stating that a self-declaration was required for refund claims less than Rs. 2 lakh, while a certificate was needed for claims exceeding that amount. However, the Court found this interpretation inconsistent with the statutory scheme of the Act, particularly Section 54 regarding refund of tax. Relevant Sections and Rules: Section 54 of the Central Goods and Services Tax Act, 2017, deals with the refund of tax, specifying the conditions under which a registered person may claim refund of unutilized input tax credit. Rule 89 of the Central Goods and Services Tax Rules mandates the filing of documentary evidence to establish the refund claim, with specific requirements for declarations and certificates based on the amount claimed. Decision on Refund Claim and Interest: The Court held that the deficiency memos requiring a certificate from a Chartered Accountant were not sustainable as the petitioner's case fell under an excepted provision in the rules. The Court set aside the memos and directed the payment of interest on the delayed refund, as per Section 56 of the Act. Additional Directions and Disposal of Petition: The Court noted that the refund had already been sanctioned to the petitioner during the proceedings but without interest. It allowed the petitioner to file further refund applications physically due to issues with the online portal. The Department was instructed not to reject such applications based solely on the ground of limitation. The petition was disposed of accordingly.
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