TaxTMI 
TaxTMI 
17 Aug 2026 
Refund claims under GST often involve both principal tax amounts and interest payable on delayed refunds. Rule 89(2)(m) of the CGST Rules, 2017 requires certification by a Chartered Accountant or Cost Accountant when refund claims exceed two lakh rupees, to ensure that the incidence of tax or interest has not been passed on to another person. However, recent judicial interpretation has clarified that this requirement does not extend to cases where taxpayers seek interest refunds after the principal refund has already been sanctioned.
In this case, the taxpayer filed a claim for interest on delayed refund of tax amounts that had already been disbursed. The department insisted on certification under Rule 89(2)(m). The High Court held that such certification was unnecessary because:
The principal refund had already been sanctioned and credited to the taxpayer.
Any subsequent interest payable is the income of the taxpayer and cannot be passed on to consumers.
Rule 89(2)(m) applies only where refund of "tax plus interest" is claimed together, not where interest is claimed separately after the principal refund.
This interpretation ensures that taxpayers are not burdened with redundant compliance requirements when claiming statutory interest.
Practical Implications
The ruling has important consequences in as much as it grants Recognition of taxpayer rights - Interest is treated as compensation for delayed payment, reinforcing the principle that taxpayers should not suffer due to administrative delays.
Many taxpayers file refund claims for interest after receiving the principal refund. Such interest is inherently the taxpayer's income and need not be passed on. Rule 89(2)(m) is designed to prevent unjust enrichment in cases where refund of tax plus interest is claimed together. It does not apply to standalone interest claims.