Case tittle | Evertime Overseas (P.) Ltd. VS Union of India |
Court | Bombay High Court |
Honourable Judge | Justice Dipankar Datta Justice M. S. Karnik |
Citation | 2021 (10) GSTPanacea 183 HC Bombay Writ Petition No. 3793 Of 2021 |
Judgment Date | 08-October-2021 |
clearly dealt with and it is on account of failure of the portal maintained by the Goods and Services Tax Network (hereafter referred to as “the GSTN” for short). It is pointed out that in spite of several communications, nothing has been done and, therefore, the writ petition has been filed seeking a direction to the respondents to decide the claim for refund and to pass appropriate orders thereon within a stipulated time frame.
In this case, the petitioner asserts their right to a refund under Section 16 of the Integrated Goods and Services Tax Act, 2017 (“IGST Act”). The petitioner argues that they are eligible for a refund under Section 16(3)(b) of the IGST Act for goods supplied. However, the petitioner claims that their refund application is being withheld by respondent no. 4, citing pending investigations against them as the reason for non-processing.
The petitioner claims entitlement to a refund under section 16 of the Integrated Goods and Services Tax Act, 2017 (IGST Act). Specifically, the petitioner asserts eligibility for refund under sub-section 3(b) of section 16 for goods supplied. However, respondent no. 4 has not processed the refund claim, citing pending investigations against the petitioner as the reason.
In response, the petitioner’s counsel referred to sub-section 10 of section 54 of the Central Goods and Services Tax Act, 2017 (CGST Act). This subsection allows the proper officer to withhold payment of refunds if the registered person has defaulted in filing returns or has outstanding tax, interest, or penalties by a specified date, unless these obligations are stayed by a court, tribunal, or appellate authority. The officer may also deduct any unpaid tax, interest, penalty, fee, or other amounts from the refund due.
Therefore, the issue revolves around whether the pending investigation justifies withholding the refund under the IGST Act and whether the provisions of the CGST Act concerning defaults in tax obligations are applicable in this case.
This summary captures the key legal points and arguments presented in the matter.
Learned counsel argues that in light of the provisions outlined in subsection 10 of section 54 of the Central Goods and Services Tax (CGST) Act In the present case, the learned counsel argues that the respondents’ refusal to process the refund, citing pending investigation, is legally unsustainable in light of the provisions outlined in subsection 10 of section 54 of the Central Goods and Services Tax (CGST) Act. The counsel draws attention to a specific instance dated May 18, 2021, as documented on page 92 of the petition. This application pertinently seeks the release of withheld amounts pertaining to drawback and Integrated Goods and Services Tax (IGST) refund.
In this case, the learned counsel argues that under Section 54(10) of the CGST Act, the respondents’ refusal to process the refund due to pending investigations is unjustifiable. He points to a specific application dated May 18, 2021, found on page 92 of the petition, which requests the release of outstanding drawback and IGST refund amounts.
On the other hand, Mr. Mishra, representing respondent Nos. 2 to 4, contends that the department’s decision not to process the application is justified due to an ongoing investigation, which is crucial for safeguarding the revenue’s interests.
In the present case, the learned counsel for the petitioner argued that the respondents’ refusal to process a refund under sub-section 10 of section 54 of the CGST Act, citing a pending investigation, is unjustifiable. Reference was made to a specific application dated May 18, 2021, found on page 92 of the petition, seeking release of outstanding drawback and IGST refund.
On the other hand, Mr. Mishra, representing respondents 2 to 4, contended that the department’s decision to withhold processing the application due to an ongoing investigation is warranted to safeguard revenue interests.
After considering the arguments and examining the facts of the case, the court opined that it would be appropriate for the respondents to process the refund claim in accordance with the law. Notably, there was no existing order or decision on record concerning the petitioner’s refund application. Therefore, the court directed respondent No. 4 to promptly process the petitioner’s refund application and issue a reasoned order after hearing the petitioner. The court emphasized that the refund claim should be adjudicated on its own merits and preferably within a timeframe of eight weeks.
In this case, the court addressed a dispute regarding the processing of a GST refund under the CGST Act, specifically focusing on Section 54(10). The petitioner argued that the refusal to process their refund due to an ongoing investigation was unjustified. They highlighted a specific application dated May 18, 2021, seeking the release of drawback and IGST refund, which was on record at page 92 of the petition.
On the other hand, Mr. Mishra, representing the respondents (department), contended that withholding the refund pending investigation was necessary to safeguard revenue interests.
After considering the arguments and the facts of the case, the court concluded that the petitioner’s refund claim should be processed by the respondents in compliance with the law. The court noted that there was no existing order or decision on record regarding the refund application. Consequently, the court directed respondent No. 4 to process the petitioner’s refund application and issue a reasoned decision after hearing the petitioner. The court emphasized the need for expeditious resolution of the refund claim, preferably within eight weeks from the date of the order. The petitioner was instructed to appear before the Competent Authority on October 21, 2021, at 11:00 a.m.
Additionally, the court kept all contentions open and disposed of the writ petition without costs.
Download PDF:
For Reference Visit:
Read Another Case Law:
GST Case law: