GST refund claim rejected : Gujarat HC directed GST Authorities to look into matter and take an appropriate decision

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GST refund claim rejected : Gujarat HC directed GST Authorities to look into matter and take an appropriate decision

Where assessee claimed refund of unutilized amount from electronic credit ledger and Competent Authority rejected claim and assessee filed writ application seeking directions to GST Authorities to pass order in terms of provisions of rule 86(4) re-crediting rejected amount in electronic credit ledger, GST Authorities were directed to look into matter and take an appropriate decision

[2019] 108 taxmann.com 571 (Gujarat)

HIGH COURT OF GUJARAT

Red Coin Paper Product

v.

Deputy Commissioner of State Tax

J.B. PARDIWALA AND A.C. RAO, JJ.

R/SPECIAL CIVIL APPLICATION NO. 10854 OF 2019

JUNE  26, 2019

Section Circulars and Notifications : Circular No. 59/33/2018 – GST, dated 4-9-2018

(NR)

FACTS

 

The assessee claimed refund of unutilized amount from the electronic credit ledger in accordance with provisions of section 54.
The Competent Authority rejected the refund claim of the assessee.
The assessee filed a writ application seeking directions to the GST Authorities to pass order in Form GST PMT-03 in terms of provisions of rule 86(4) re-crediting the rejected amount in the electronic credit ledger for the tax period from May, 2018 to July, 2018.

HELD

 

The Court proposes to dispose of the writ application with a direction to both the Deputy Commissioner of State Tax, Surat as well as the Assistant Commissioner of State Tax, Surat to look into the matter and take an appropriate decision in accordance with law within a period of 15 days. [Para 5]

M.B. Gohil for the Petitioner. Ms. Maithili Mehta, AGP for the Respondent.

ORAL ORDER

J.B. Pardiwala, J. – RULE, returnable forthwith.. Ms.Maithili Mehta, learned AGP waived service of notice of rule for and on behalf of the respondent.

2. By this writ application, the writ applicant, a partnership firm has prayed for the following main reliefs:—

“19(A). YOUR LORDSHIPS be pleased to issue writ of mandamus or any other appropriate writ, order or direction to the respondent authority to pass order in FORM GST-PMT-03 in terms of provision of Rule 86(4) of the Central Goods and Service Tax Act, 2017 read with Circular No.59/33/2018- GST re-crediting the rejected amount in the electronic credit ledger for tax period of May-2018.

(B). YOUR LORDSHIPS be pleased to issue writ of mandamus or any other appropriate writ, order or direction to the respondent authority to pass order in FORM GST-PMT-03 in terms of provision of Rule 86(4) of the Central Goods and Service Tax Act, 2017 read with Circular No.59/33/2018-GST re-crediting the rejected amount in the electronic credit ledger for tax period of June-2018.

(C) YOUR LORDSHIPS be pleased to issue writ of mandamus or any other appropriate writ, order or direction to the respondent authority to pass order in FORM GST-PMT-03 in terms of provision of Rule 86(4) of the Central Goods and Service Tax Act, 2017 read with Circular No.59/33/2018-GST re-crediting the rejected amount in the electronic credit ledger for tax period of July-2018.”

3. The writ applicant is carrying on business of manufacturing and trading of paper products. The writ applicant has obtained registration under section 25 of the Central Goods and Service Tax Act, 2017 (for Short “CGST Act”).

3.1 The writ applicant seeks to redress his grievance with regard to inaction on the part of the respondent authority in not passing an order in accordance with Rule 86(4) of the CGST Rules, 2017 for re-credit of the amount of input tax credit to the electronic credit ledger account maintained by the writ applicant on rejection of the refund claim.

3.2 According to the writ applicant, the inaction on the part of the authority in not granting credit of input tax credit to the electronic credit ledger even after rejection of the refund claimed for the period of May, 2018, June, 2018 and July, 2018 by the petitioner and further in not passing order in Form GST-PMT-03 is violative of the fundamental rights guaranteed under Article 19(1)(g) of the Constitution of India.

4. Mr. Vijay Patel, the learned counsel appearing for the writ applicant vehemently submitted that during the relevant tax period under consideration i.e. May, 2018, June, 2018 and July, 2018, his client had affected zero rated sales as per the provisions of section 16 of the Integrated Goods and Service Tax Act without payment of tax. He would submit that his client is entitled to claim full refund of the utilized input tax credit under the provisions of section 54 of the CGST Act.

4.1 Mr. Patel invited the attention of this Court to the representation preferred by his client dated 30/10/2018 addressed to the Deputy Commissioner of State Tax, Range-15, Surat. The representation is at page 73 of the Paper Book at Annexure-A.

4.2 Mr. Patel also invited the attention of this Court to a document at page 75 of the Paper Book. The document at page 75 dated 02/11/2018 is a communication addressed by the Deputy Commissioner to the Assistant Commissioner, Surat with regard to the refund as claimed by the writ applicant herein.

4.3 Mr. Patel, the learned counsel would submit that till this date, no cognizance has been taken, either by the Deputy Commissioner or by the Assistant Commissioner in this regard. He submitted that the Deputy Commissioner in so many words had informed the Assistant Commissioner to do the needful in the matter. However, till date, nothing has been done so far.

5. Having heard the learned counsel appearing for the parties and having gone through the materials on record, we propose to dispose of this writ application with a direction to both, the Deputy Commissioner of State Tax, Range-15, Surat as well as to the Assistant Commissioner of State Tax, Range-1, Surat to look into the matter and take an appropriate decision in accordance with law within a period of 15 days from the date of receipt of writ of this order.

The Deputy Commissioner of State Tax, Range-15, Surat shall see to it that the Assistant Commissioner of State Tax, Range-1, Surat gives effect to the communication dated 02/11/2018, which is at page 75.

Let needful be done in accordance with law without fail.

We hope and trust that necessary orders in accordance with law shall be passed and the writ application is not unnecessarily dragged to second round of litigation.

With the above, this writ application stands disposed of.

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