Supernova Engineers Ltd VS Union Of India

The petitioners have filed a petition challenging an order dated 12th July 2021 passed by the Joint Commissioner (Appeals), CGST Appeal Commissionerate, Ahmedabad. Mr. Anand Nainawati, the learned advocate representing the petitioners, argued several key points. He contended that the impugned order was erroneous and unjust, urging the court to review it. Mr. Nainawati presented compelling arguments highlighting discrepancies in the order and emphasized the adverse impact it would have on the petitioners if upheld. He meticulously dissected the legal grounds on which the order was based and asserted that it lacked merit. Additionally, Mr. Nainawati provided evidence and precedents to support his arguments, aiming to persuade the court to overturn the decision.

On the other hand, Mr. Nikunt K. Raval, the learned advocate representing the respondents, countered the petitioners’ claims. He presented a robust defense of the order, arguing that it was legally sound and based on thorough examination and consideration of the relevant facts and laws. Mr. Raval challenged the assertions made by Mr. Nainawati, refuting each point with counterarguments supported by legal interpretations and precedents. He asserted that the order in question was justified and in accordance with applicable regulations.

Throughout the proceedings, both advocates engaged in a rigorous legal debate, each striving to present their case convincingly. The court carefully considered the arguments put forth by both sides, weighing the evidence and legal principles involved. Ultimately, the court’s decision would hinge on its interpretation of the law and its assessment of the merits of each party’s arguments.

In a recent legal proceeding, Advocate Mr. Anand Nainawati represented the petitioners, while Advocate Mr. Nikunt K. Raval spoke on behalf of the respondents. The petitioners contested an order issued on July 12, 2021, by the Joint Commissioner (Appeals), CGST Appeal Commissionerate, Ahmedabad. This order rejected the petitioners’ appeal for a refund claimed under Section 16 of the Integrated Goods and Service Tax Act, 2017 (IGST Act), in conjunction with Section 54 of the Central Goods and Service Tax Act, 2017 (CGST Act).

The petitioners, engaged in manufacturing and supplying Diesel Gensets (DG sets), which fall under Chapter heading 85 of the First Schedule to the Customs Tariff Act, 1975. They conduct both domestic supply and export activities, with exports classified as zero-rated supplies of finished goods. Under the IGST Act, the petitioners have the option to export goods either by paying Integrated Goods and Service Tax (IGST) or without payment under a Bond or Letter of Undertaking (LUT), as applicable.

In the legal proceedings, Mr. Anand Nainawati, representing the petitioners, raised objections against the order issued on July 12, 2021, by the Joint Commissioner (Appeals), CGST Appeal Commissionerate, Ahmedabad. This order rejected the petitioners’ appeal for a refund claimed under Section 16 of the Integrated Goods and Service Tax Act, 2017 (IGST Act) along with Section 54 of the Central Goods and Service Tax Act, 2017 (CGST Act).

The petitioners, involved in the manufacturing and supply of Diesel Gensets (DG sets) classified under Chapter heading 85 of the First Schedule to the Customs Tariff Act, 1975, are engaged in both domestic supply and exporting goods as zero-rated supplies. They export goods either by paying Integrated Goods and Service Tax (IGST) or without payment under Bond or LUT (Letter of Undertaking) as applicable. Notably, the petitioners supplied DG sets worth Rs. 58,50,000/- on January 28, 2020, to M/s. Quartzkraft LLP located in the Special Economic Zone (SEZ) area, with an IGST payment of Rs. 10,53,000/-.

As per Sub-section (3) of Section 16 of the CGST Act, the petitioners were entitled to claim a refund of the IGST paid on goods supplied to SEZ units, in line with the provisions of Section 54 of the CGST Act, considering such supply as zero-rated per Section 16(1) of the CGST Act. Consequently, the petitioners filed an online refund application on October 30, 2020, adhering to the provisions of Section 54(8) read with Rule 89 of the CGST Rules, 2017.

In this case, the petitioners are contesting an order dated July 12, 2021, issued by the Joint Commissioner (Appeals), CGST Appeal Commissionerate, Ahmedabad, which rejected their appeal for a refund claimed under Section 16 of the Integrated Goods and Service Tax Act, 2017 (IGST Act) along with Section 54 of the Central Goods and Service Tax Act, 2017 (CGST Act).

The petitioners are involved in the manufacturing and supply of Diesel Gensets (DG sets) classified under Chapter heading 85 of the First Schedule to the Customs Tariff Act, 1975. They both engage in domestic supply and export goods as zero-rated supplies. Under the IGST Act, goods can be exported either by paying Integrated Goods and Service Tax (IGST) or without payment under Bond or Letter of Undertaking (LUT). On January 28, 2020, the petitioners supplied DG sets worth Rs. 58,50,000/- to M/s. Quartzkraft LLP located at a Special Economic Zone (SEZ) area, with an IGST payment of Rs. 10,53,000/-.

According to Section 16(3) of the CGST Act, the petitioners were entitled to claim a refund of the IGST paid on goods supplied to SEZ units, treated as zero-rated supply under Section 16(1) of the CGST Act.

Subsequently, the petitioners filed an online refund application on October 30, 2020, following the provisions of Section 54(8) read with Rule 89 of the CGST Rules, 2017. However, the Commissioner, Central GST, Division-Kadi, Gandhinagar Commissionerate, issued a show-cause notice on November 11, 2020, via the online portal, proposing to reject the refund claim. The ground for rejection was that the IGST amount charged on the supply was not added to the taxable amount, and the specified officer’s endorsement of the SEZ was not present on the front side.

In response, the petitioners submitted a reply dated November 19, 2020, to the show-cause notice. They argued that they didn’t receive the tax amount from the recipient of the goods, hence the IGST amount was not added to the total amount after tax payment. They claimed that they rightfully paid IGST to the Government, which could be verified from the return filed in Form GSTR-3B. Additionally, they submitted the required documents along with Form GST-RFD-09.

The matter was brought before the court with Mr. Anand Nainawati advocating for the petitioners and Mr. Nikunt K. Raval representing the respondents.

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