Gamma Gaana Limited VS Union of India

The court heard arguments from Sri Nishant Mishra, representing the petitioner, and Sri B.P. Singh Kachhawah, representing the State respondents. There was no representation for respondent numbers 1 and 2.

The petitioner filed a writ petition seeking the following reliefs:

1. Declaration of Ultra Vires:

* A declaration that Rule 90(3) of the Central Goods and Services Tax (CGST) Rules, 2017 and corresponding Rule 90(3) of the Uttar Pradesh Goods and Services Tax (UPGST) Rules, 2017, as well as Paragraph 12 of Circular F. No. 125/44/2019-GST dated 18.11.2019 issued by respondent no.2, are ultra vires Article 14 of the Indian Constitution, and/or ultra vires Section 54 of the CGST Act, 2017 and Section 54 of the UPGST Act, 2017.

2. Alternate Relief:

* A mandamus declaring that fresh applications for refund made pursuant to deficiency memorandums issued under Rule 90(3) of the CGST Rules, 2017 and the corresponding UPGST Rule will relate back to the date of the original refund application.

3. Certiorari and Quashing of Impugned Orders:

* A certiorari calling for records and quashing the impugned orders dated 01.07.2021 (Annexure-4) passed by respondent no.4, and consequently directing respondent no.4 to process the petitioner’s refund claims without any limitation objections.

During the proceedings, Sri Nishant Mishra, counsel for the petitioner, stated that the petitioner did not wish to pursue reliefs ‘A’ and ‘B’, effectively withdrawing the challenge to the validity of the specified provisions. Consequently, these reliefs were considered not pressed.

The core issue is the petitioner’s application for tax refunds for the periods April to June 2018, July to September 2018, and October to December 2018, which were rejected by the impugned order issued by respondent no.4. The petitioner seeks to have these refund claims processed without objections related to the limitation period.

Heard Sri Nishant Mishra, learned counsel for the petitioner, and Sri B.P. Singh Kachhawah, learned Standing Counsel for the State-respondents. No representation was present for respondent nos. 1 and 2.

The petitioner has filed this writ petition seeking the following reliefs:

1. Relief A: To issue an appropriate writ, order, or direction declaring Rule 90(3) of the Central Goods and Services Tax Rules, 2017, and the corresponding Rule 90(3) of the Uttar Pradesh Goods and Services Tax Rules, 2017, along with Paragraph 12 of the Circular F. No. 125/44/2019-GST dated 18.11.2019 issued by respondent no. 2, as being ultra vires Article 14 of the Constitution of India and/or ultra vires Section 54 of the Central Goods and Services Tax Act, 2017 and Section 54 of the Uttar Pradesh Goods and Services Tax Act, 2017.

2. Relief B: Alternatively, to issue a writ, order, or direction in the nature of mandamus declaring that the fresh applications for refund made pursuant to deficiency memorandums issued under Rule 90(3) of the Central Goods and Services Tax Rules, 2017, and corresponding Rule 90(3) of the Uttar Pradesh Goods and Services Tax Rules, 2017, will date back to the date of the original application for refund.

3. Relief C: To issue a writ, order, or direction in the nature of certiorari calling for records and quashing the impugned orders dated 01.07.2021 passed by respondent no. 4, and consequently, directing respondent no. 4 to process the claims of refund of the petitioner without any objection on the grounds of limitation.

During the proceedings, Sri Nishant Mishra, learned counsel for the petitioner, stated that the petitioner does not wish to press relief Nos. ‘A’ and ‘B’. As such, the challenge to the validity of the provisions is withdrawn. Consequently, relief Nos. ‘A’ and ‘B’ are considered as not pressed by the petitioner.

The petitioner had filed a refund application for the tax periods from April to June 2018, July to September 2018, and October to December 2018, which were rejected by the impugned order passed by respondent no. 4. According to the impugned order, the period of limitation for filing a refund application under Section 54(1) of the CGST/UPGST Act had expired in September 2020, and even the period extended by the department expired on 30.11.2020. The petitioner subsequently filed a refund application on 31.03.2021, which was rejected on the grounds of delay.

Learned counsel for the petitioner submitted that the period between 15.03.2020 and 31.03.2021 should be considered for exclusion due to the extraordinary circumstances created by the COVID-19 pandemic. However, this submission was not accepted by the respondent, leading to the rejection of the refund application on the grounds of limitation.

The petition, therefore, primarily seeks a directive for respondent no. 4 to process the refund claims without considering the objections related to the period of limitation.

In the case presented, the petitioner, represented by counsel Sri Nishant Mishra, filed a writ petition challenging the rejection of their tax refund applications by respondent no.4. The petition initially sought three forms of relief, but during the proceedings, the petitioner chose to withdraw two of them, specifically the challenges to the legality of certain rules and a circular under the Central and Uttar Pradesh Goods and Services Tax Acts.

The petitioner’s core complaint was that their refund applications for three tax periods in 2018 had been rejected on the grounds of being filed beyond the stipulated time limits. The relevant orders noted that the statutory period for filing these refund claims had expired in September 2020, with an extended deadline of November 30, 2020. However, the applications were filed on March 31, 2021, leading to their dismissal due to lateness.

Counsel for the petitioner argued that this rejection was unjust, citing a Supreme Court order dated January 10, 2022, which mandated the exclusion of the period from March 15, 2020, to February 28, 2022, from limitation calculations due to disruptions caused by the COVID-19 pandemic. This order was part of Miscellaneous Application No. 21 of 2022 in Suo-Moto Writ Petition No. 3 of 2020 and aimed to mitigate the pandemic’s impact on legal proceedings.

The learned Standing Counsel for the state did not dispute this exclusion period. The court noted that the Supreme Court’s order intended to address adversities faced by litigants during the pandemic by suspending the limitation periods for judicial and quasi-judicial proceedings.

Considering these arguments and the Supreme Court’s directive, the court concluded that the respondent no.4 had improperly dismissed the petitioner’s refund applications on the grounds of delay. Consequently, the court quashed the impugned rejection order and remitted the matter back to respondent no.4, directing them to reassess the petitioner’s refund claims without considering the period of delay as a factor.

Download PDF:

For Reference Visit:

Read Another Case Law:

GST Case Law: