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TMI Blog2022 (10) TMI 1259X X X X Extracts X X X X X X X X Extracts X X X X ..... is placed upon the decision of Supreme Court in case of Commissioner v. Ratan Melting and Wire Industries [ 2008 (10) TMI 5 - SUPREME COURT] wherein it is held that circulars and instructions issued by the Board are merely instructions for understanding of statutory provisions and are not binding on the Court. It was further held that circulars which are contrary to the statutory provisions has no existence in eye of law. The petitioner was holding valid registration number under the CGST Act, 2017 and was exporter entitled to benefit under the provisions of IGST Act, 2017, the petitioner is entitled to refund of IGST paid as per the provisions of section 16(3)(b) of the IGST Act, 2017 read with section 54 of the CGST Act, 2017 and Rule 96 of the CGST Rules, 2017 as the shipping bill filed by the petitioner shall be deemed to be an application for refund of IGST integrated tax paid on the goods exported outside India and such application shall be deemed to have been filed as per the procedure prescribed under Rule 96 of CGST Rules, 2017. The petitioner is even otherwise entitled to refund of IGST as envisaged under the relevant provisions of IGST Act, 2017 CGST Act, 2017 and CGST ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rated tax and claim refund of such tax paid on goods or services or both supplied, in accordance with Section 54 of the Central Goods and Service Tax Act, 2017 (For short CGST Act, 2017 ). 5.3) As provided in Rule 96 of the Central Goods and Service Tax Rules, 2017 (For short the CGST Rules, 2017 ) the shipping bill filed by an exporter of goods shall be deemed to be an application for refund of integrated tax paid on the goods exported out of India and such application shall be deemed to have been filed only when the person in charge of conveyance carrying the export of goods duly files an export manifest or an export report covering the number and the date of shipping bills or bills of export and the petitioner has furnished a valid return in Form - GSTR-3 or Form GSTR-3B. 5.4) Accordingly, the petitioner had for the purpose of exporting goods out of India issued invoices, Shipping Bills. Export General Manifest and Bill of Lading were also generated by the Shipping Line. Goods exported by the petitioner under invoice on payment of IGST of Rs.2,26,087/- in aggregate under three shipping bills are as under: Sr. No. GST Invoice No. Date Shipping Bill no. Date Export General Manifes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Being aggrieved by inaction on part of the respondents, the petitioner has preferred the present petition. 6. Learned advocate Mr. D.K. Trivedi submitted that there is no embargo on availing drawback at higher rate by punching A instead of B on one hand and availing refund of IGST paid with regard to the Zero Rated Supply i.e. goods exported out of India. It was therefore, submitted that the respondent authorities ought to have sanctioned the refund immediately irrespective of whether A was punched or B was punched in the shipping bills. 6.1) It was further submitted that the approach of the respondent authority is completely illegal and not in accordance with the provisions of the statute inasmuch as the rate of drawback is 2% and 1.5% respectively depending on the product exported irrespective of whether A is punched or B is punched in the shipping bill. It was therefore, submitted that the petitioner has not received any benefit or higher drawback and therefore, the respondent authority could not have refused to sanction the refund of IGST. 6.2) It was pointed out by learned advocate Mr. Trivedi that the goods were exported out of India in July and August 2017 and considerable l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4(11) read with Rule 96(4) is existing in the facts of the case and the petitioner was never intimated with regard to the withholding of refund in accordance with Rule 96(5) or any order in Part-B of Form GST RFD-07 was issued by the respondent authorities as required under Rule 96(7) of the CGST Rules, 2017. 6.7) In support of his submissions, learned advocate Mr. Trivedi relied upon the decision of coordinate Bench of this Court in case of Amit Cotton Industries v. Principal Commissioner of Customs (Judgment dated 27.06.2019 in Special Civil Application No.20126 of 2018) wherein in similar situation, this Court had an occasion of testing Circular No.37/2018-Custom dated 9.10.2018 on the basis of which the authorities concerned were not sanctioning the refund on the very same ground as higher rate of drawback was claimed, no refund could be sanctioned. It was pointed out that this Court has observed that the circular was in conflict with the provisions of the statute and therefore, the refund could not have been withheld. It was therefore, prayed that the refund withheld by the respondent authorities is required to be paid along with interest at the rate of 18% to the petitioner f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... system driven process of sanctioning the IGST refund of the subject Shipping Bills has been withheld by the EDI System and there is no inbuilt mechanism in Customs ICES to sanction or process IGST paid amount in cases where the petitioner claims higher rate of drawback or where higher rate and lower rate are identical. 7.2) It was submitted that the rationale for not allowing the refund of IGST by the authority is that the higher duty drawback reflects the elements of customs, central excise and service tax taken together, which is confirmed by the Para 7 of the Notification 131/2016-Custom (N.T) dated 31.10.2016 and as higher duty drawback has already been availed then granting the IGST refund would amount to double benefit as the Central Excise and Service Tax has been subsumed in GST. It was therefore, submitted that even though in the facts of the present case the drawback under higher rate and lower rate is identical, the refund of IGST amount was not processed by the Customs ICES System as the petitioner had availed the higher drawback in Category A . 8. Having heard the learned advocates for the respective parties and on perusal of the material placed on record, it is an adm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... supply. Rule 96 reads as under: Rule 96: Refund of integrated tax paid on goods or services exported out of India.-- (1) The shipping bill filed by an exporter of goods shall be deemed to be an application for refund of integrated tax paid on the goods exported out of India and such application shall be deemed to have been filed only when:- (a) the person in charge of the conveyance carrying the export goods duly files a departure manifest or an export manifest or an export report covering the number and the date of shipping bills or bills of export; and (b) the applicant has furnished a valid return in FORM GSTR-3 or FORM GSTR-3B, as the case may be; (2) The details of the relevant export invoices in respect of export of goods contained in FORM GSTR-1 shall be transmitted electronically by the common portal to the system designated by the Customs and the said system shall electronically transmit to the common portal, a confirmation that the goods covered by the said invoices have been exported out of India. Provided that where the date for furnishing the details of outward supplies in FORM GSTR-1 for a tax period has been extended in exercise of the powers conferred under section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the exports to Bhutan for such class of goods as may be notified in this behalf and where such refund is paid to the Government of Bhutan, the exporter shall not be paid any refund of the integrated tax. (9) The application for refund of integrated tax paid on the services exported out of India shall be filed in FORM GST RFD-01 and shall be dealt with in accordance with the provisions of rule 89. (10) The persons claiming refund of integrated tax paid on exports of goods or services should not have received supplies on which the benefit of the Government of India, Ministry of Finance notification No. 48/2017-Central Tax, dated the 18th October, 2017, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R 1305 (E), dated the 18th October, 2017 or notification No. 40/2017-Central Tax (Rate), dated the 23rd October, 2017 published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R 1320 (E), dated the 23rd October, 2017 or notification No. 41/2017- Integrated Tax (Rate), dated the 23rd October, 2017, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... im of the writapplicant is to be rejected only on the basis of the circular issued by the Government of India dated 9th October 2018 referred to above, then we are afraid the submission canvassed on behalf of the respondents should fail as the same is not sustainable in law. 29. We are not impressed by the stance of the respondents that although the writ-applicant might have returned the differential drawback amount, yet as there is no option available in the system to consider the claim, the writapplicant is not entitled to the refund of the IGST. First, the circular upon which reliance has been placed, in our opinion, cannot be said to have any legal force. The circular cannot run contrary to the statutory rules, more particularly, Rule 96 referred to above. 30. Rule 96 is relevant for two purposes. The shipping bill that the exporter may file is deemed to be an application for refund of the integrated tax paid on the goods exported out of India and the claim for refund can be withheld only in the following contingencies : (a) a request has been received from the jurisdictional Commissioner of central tax, State tax or Union territory tax to withhold the payment of refund due to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Looked at from another angle, a circular which is contrary to the statutory provisions has really no existence in law. 7. As noted in the order of reference the correct position vis-a-vis the observations in para 11 of Dhiren Chemical s case (supra) has been stated in Kalyani s case (supra). If the submissions of learned counsel for the assessee are accepted, it would mean that there is no scope for filing an appeal. In that case, there is no question of a decision of this Court on the point being rendered. Obviously, the assessee will not file an appeal questioning the view expressed vis-a-vis the circular. It has to be the revenue authority who has to question that. To lay content with the circular would mean that the valuable right of challenge would be denied to him and there would be no scope for adjudication by the High Court or the Supreme Court. That would be against very concept of majesty of law declared by this Court and the binding effect in terms of Article 141 of the Constitution. 33. In the case of J.K. Lakshmi Cement Limited v. Commercial Tax Officer, Pali, reported in 2018(14) G.S.T.L. 497 (S.C.), the Supreme Court observed as under : 25. The understanding by the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stands withdrawn and was only applicable to the notification dated 07.03.1994. It was not specifically applicable to the notification dated 21.01.2000. The fact that the third paragraph of the notification dated 21.01.2000 is identically worded to the third paragraph of the notification dated 07.03.1994 but that would not by itself justify the applicability of circular dated 15.04.1994. 28. In this context, we may note another contention that has been advanced before us. It is based upon the doctrine of contemporanea exposition. In our considered opinion, the said doctrine would not be applicable and cannot be pressed into service. Usage or practice developed under a statute is indicative of the meaning prescribed to its words by contemporary opinion. In case of an ancient statute, doctrine of contemporanea exposition is applied as an admissible aid to its construction. The doctrine is based upon the precept that the words used in a statutory provision must be understood in the same way in which they are usually understood in ordinary common parlance by the people in the area and business. (See : G.P. Singh s Principles of Statutory Interpretation, 13th Edition-2012 at page 344). I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the present case are squarely covered by the decision in case of Amit Cotton Industries (supra) wherein reliance is placed upon the decision of Supreme Court in case of Commissioner v. Ratan Melting and Wire Industries reported in 2018(12) S.T.R. 416(SC) wherein it is held that circulars and instructions issued by the Board are merely instructions for understanding of statutory provisions and are not binding on the Court. It was further held that circulars which are contrary to the statutory provisions has no existence in eye of law. 17. Similarly, in case of J.K. Lakshmi Cement Ltd. v. Commercial Tax Officer, Pali, reported in 2018 (14) G.S.T.L. 497 (SC), it was held by the Hon ble Supreme Court that power to issue circulars is for just, proper and efficient management of the work and in public interest and such power for proper administration of fiscal law is utilised for avoiding undue hardship to the assessee. 18. Therefore, in view of the fact that the petitioner was holding valid registration number under the CGST Act, 2017 and was exporter entitled to benefit under the provisions of IGST Act, 2017, the petitioner is entitled to refund of IGST paid as per the provisions of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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