Refund claim should not be rejected due to deficiency of GST network: HC

Case Details: Aartos International LLP v. Deputy Commissioner (Customs) - [2022] 145 taxmann.com 558 (Gujarat)

Judiciary and Counsel Details

• • Ms Sonia Gokani & Mrs Mauna M. Bhatt, JJ.
  • Hardik V. Vora for the Petitioner.
  • Nikunt K. Raval for the Respondent.

Facts of the Case

The petitioner had exported goods and refund was granted to two out of three shipping bills filed but refund on account of one shipping bill was rejected. The department contended that third shipping bill was showing “Permanent Cancellation by PAO for transaction” as per ICEGATE Scroll status and refund was not paid by bank on account of mismatch in name of firm of petitioner. The petitioner filed petition seeking refund along with interest before the High Court.

High Court Held

The Honorable High Court noted that shipping bills are deemed as refund application when goods are exported with payment of tax and therefore, department should have sanctioned 90 percent of amount claimed in said bills. The Court also noted that the refund was not granted due to deficiency of GST network and it is duty of GSTN to enquire if there is any difficulty at level of mismatch or processing of claim of refund. Thus, the Court directed GSTN/concerned authority to introduce a feature in GST portal to communicate problems faced by assessee directly instead of officers pleading their seniors through GSTN. The Court also directed department to sanction refund with interest at rate of 6 percent.