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2024 (10) TMI 1391 - HC - GSTRejection of refund claim - lack of opportunity for a personal hearing as required by Rule 92(3) of the CGST Rules, 2017 - violation of principles of natural justice - HELD THAT - The show causes issued to the Petitioner gave the Petitioner 15 days to respond. Accordingly, they did respond by 17 April 2024. Therefore, it is rather incomprehensible how a hearing was allegedly given on 8 April 2024. The Petitioner has denied that any hearing was ever given. The show cause notice had also stated that the date and time of the hearing would be intimated to the Petitioner. There is no clear evidence of such intimation. In any event, proviso to Rule 92 (3) of the CGST Rules, 2017, contemplates reasonable opportunity to be heard, implying that such hearing should be after the Petitioner files the reply within the time prescribed in the show cause notice. The impugned refund rejection orders are in breach of the requirements of Rule 92 (3) of the CGST Rules, 2017 and the principles of natural justice and fair play. The refund rejection orders dated 25 April 2024 are quashed and set aside - matter remanded to Respondent No.3 for fresh consideration of the Petitioner s refund application dated 28 February 2024 - petition allowed by way of remand.
Issues:
Challenge to refund rejection orders due to lack of opportunity for a personal hearing as required by Rule 92(3) of the CGST Rules, 2017. Analysis: The petition challenged refund rejection orders issued on 25 April 2024, alleging a violation of Rule 92(3) of the CGST Rules, 2017. The petitioner had applied for a refund on 25 April 2024 and was later served with a show-cause notice on 3 April 2024. The notice required a response within 15 days, as per Rule 92(3). The petitioner submitted a reply on 16 April 2024, which was uploaded on the department's website the next day. However, the impugned refund rejection orders were issued on 25 April 2024 without any reference to a personal hearing, as mandated by Rule 92(3) of the CGST Rules, 2017. The respondent claimed that a personal hearing was conducted on 8 April 2024, supported by a screenshot of FORM-GST-RFD-01. Nevertheless, the petitioner denied receiving any such hearing. The proviso to Rule 92(3) emphasizes providing a reasonable opportunity to be heard before rejecting a refund application. The petitioner's timely response to the show-cause notice by 17 April 2024 raised doubts about the alleged hearing on 8 April 2024. The rule implies that the hearing should occur after the petitioner submits a reply within the specified timeframe. The High Court found the refund rejection orders to be in violation of Rule 92(3) of the CGST Rules, 2017 and the principles of natural justice. Consequently, the court quashed the orders and remanded the matter to the respondent for reconsideration of the petitioner's refund application dated 28 February 2024. The court directed the respondent to provide a reasonable opportunity for a hearing and issue a reasoned order within four weeks. The judgment was made absolute with no costs awarded, leaving all contentions on merits open for further consideration. In conclusion, the High Court's decision emphasized the importance of adhering to procedural requirements and principles of natural justice in matters concerning refund applications under the CGST Rules, 2017. The judgment serves as a reminder of the necessity to provide applicants with a fair opportunity to be heard before making decisions that impact their rights.
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