GST / Indirect Tax : Refund of Excess Deposit
In case of Siddhant Steels v. State of Chhattisgarh [2025] GCtR 1451 (Chhattisgarh), premises of a person were inspected by Department. Show cause notice was issued. Statement was recorded. He was coerced to deposit amount. Petitioner raised issued of violation of “Instruction No.01/2022-23 [GST - Investigation] issued by Finance Ministry on 25.05.2022.
Department said that there was a mismatch of the E-Way bill related information and the input tax.
HC agreed that the amount so deposited by the Petitioner, if found in excess, may be adjusted at the time of final adjudication or with the amount of dues, if any, in his favour.
It was held that whenever any inspection is carried out in terms of Section 71 of the CGST Act, 2017, further course of action must be initiated by the concerned authorities in an expeditious manner in the spirit of Act of 2017.
The Circular of 2022 clarifies whether recovery can be done during search or not. Voluntary tax payments are to be made under DRC-03. The Circular mandates initiating disciplinary action against Tax Department employees if they violate the Circular.
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