GST and Refund of Unutilised Input Tax Credit (ITC) : Law on Time Limit of 2 years under S.54

GST and Refund of unutilised Input Tax Credit (ITC) : Law on Time Limit of 2 years under S.54

In an important case it was held that "a plain reading of Sub-section (1) of Section 54 of the CGST Act, 2017 indicates that any person who is claiming a refund of tax or interest, if any, paid on the amount is entitled to make an application before the expiry of two years from the relevant date and in such form and manner as may be prescribed. The term “relevant date” has been defined in Explanation (2) to Section 54 of the CGST Act."

In terms of Rule 89(1) of Central Goods & Services Rules, 2017 any person claiming refund of tax was required to make an application electronically in FORM GST RFD-01 along with the requisite documents.

By Notification No. 55/2107-CT dated 15.11.2017, Rule 97A was introduced in the CGST Rules specifying that any reference to electronic filing of an application would also include manual filing. However, it is material to note that Rule 97A of the CGST Rules was introduced after the petitioner had exported some of its consignments.

It is also material to note that there were technical glitches in the electronic system of the GST authorities and taxpayers across the board were facing difficulties in electronic filing of returns. 

If the taxpayer has made a bona fide attempt to make an application but was prevented to do so on account of technical glitches or for any reason attributable to GST authorities, its claim for refund cannot be denied on account of delay.

Technical Glitches 

It was noted that there is no dispute that the petitioner had attempted to upload its application for refund but could not do so on account of technical glitches. Court held that it is difficult to accept that the petitioner’s legitimate right to seek refund could be foreclosed on account of such technical glitches. 

Case : Sethi Sons v. Assistant Commissioner [2023] GCtR 2537 (Delhi)

GST / Indirect Tax : Principles of Refund and Interest under the CGST Act, 2017

GST / Indirect Tax : Principles of Refund and Interest under the CGST Act, 2017 

In case of Lenovo (I) Pvt Ltd v. Joint Commissioner of GST [2023] GCtR 2504 (Madras) it was held that a reading of the Section 54 (1) of CGST Act, 2017 would make it clear that the assessee can make the application within two years. 

It was held that the terms used in said Section ''may make application before two years from the relevant date in such form and manner as may be prescribed'', which means that the assessee may make application within two years and it is not mandatory that the application has to be made within two years and in appropriate cases, refund application can be made even beyond two years. The time limit fixed under Section 54 (1) is directory in nature and it is not mandatory. Therefore, even if the application is filed beyond the period of two years, the legitimate claim of refund by the assessee cannot be denied in appropriate cases.

GST Refund : HC Allows the Petition Seeking Refund

 GST Refund : HC Allows the Petition Seeking Refund

Section 2 (17) of CGST Act, 2017 defines "business". Section 2 (74) of the CGST Act, 2017 defines "mixed supply". Section 22 (1) of the Act fixes an amount of Rs. 20 lacs. Section 29 deals with cancellation of registration.

In an interesting case citation [2019] GCtR 3119, the petition filed for refund of GST was allowed and the GST Department was directed to refund the amount to the petitioner.

Written by 

Vishal

Delhi

Notice : Copyright of above blog and its content including headline vests with Vishal. Above should Not be reproduced in any form in newspapers/websites/Ph.D. thesis/College projects/ law firms' newsletters/law journals/books/book chapters without prior written permission. Fair use should be in terms of Copyright Act, 1957. Any violation will make violator liable for Pecuniary compensation with interest towards the author irrespective of the profit made. All disputes shall be subject to Delhi Jurisdiction. Reproduction of judgment or publication of judgment unless expressly prohibited by Court according is not an infringement of copyright according to S. 52 (1)(q)(iv) of Copyright Act, 1957.  

Refund of Duty : Order of Customs Commissioner Set Aside

Refund of the Duty : Order of Customs Commissioner Set Aside 

Customs Act, 1962 contains around 161 sections. Section 2 (23) of the Act defines what is "import".

In an important case citation [2014] GCtR 3089, the Commissioner, Customs had rejected the application for refund of duty citing certain provisions of the Customs Act, 1962. 

When the action of Customs Commissioner was challenged in the litigation, the Order of Customs Commissioner not to refund the duty was set aside and the applicant was held entitled to the refund of the duty. 

There was a brilliant analysis and implication of the Customs Act, 1962 and the Customs Tariff Act, 1975  done in this case citation [2014] GCtR 3089. 

Written by 

Vishal

Delhi

Notice : Copyright of above blog and its content including headline vests with Vishal. Above should Not be reproduced in any form in newspapers/websites/Ph.D. thesis/College projects/ law firms' newsletters/law journals/books/book chapters without prior written permission. Fair use should be in terms of Copyright Act, 1957. Any violation will make violator liable for Pecuniary compensation with interest towards the author irrespective of the profit made. All disputes shall be subject to Delhi Jurisdiction. Reproduction of judgment or publication of judgment unless expressly prohibited by Court according is not an infringement of copyright according to S. 52 (1)(q)(iv) of Copyright Act, 1957.