2018 (12) TMI 1839 - Commissioner - GST

Appellate Authority overturns refund rejection, criticizes mechanical approach, emphasizes fair treatment.

IN RE : NIRAJKUMAR PRABHUDAS PATEL

The Appellate Authority overturned the rejection of refund claims by the adjudicating authority due to non-submission of the GST RFD-01A printout, citing ... Refund of ITC - export of goods and services without payment of integrated tax - refund claims were rejected on account of the fact that the appellant could not submit the GST RFD-01A, which was to be submitted along with the refund claims as per the Circular No. 17/17/2017-GST, dated 15-11-2017 - HELD THAT:- The appellant has explained the reason for not submitting the same. His correspondence [e-mails] with GSTN and the comm, admin of CGST Gandhinagar Commissionerate enclosed with the appeal papers, clearly shows that there was a problem during the said period in taking printouts of Form GST RFD-01A and that this problem was faced by many of other appellants also. However, subsequent to the rejection of the refund on 14-4-2018, the appellant was able to take a printout of the said GST RFD-01A, which is enclosed with the appeal papers. The primary and only ground on which the refund claims stood rejected was that he was not in a position to provide a printout of GST RFD-01A. This stands corrected since the appellant has provided a printout of the GST RFD-01A generated by the system. Surely, the appellant should not be punished for the problems/glitches in the portal/system - also, in terms of Rule 93(2) of the CGST Rules, 2017, the adjudicating authority has re-credited the electronic credit ledger by an order in Form GST PMT-03 on 24-3-2018. Also, the appellant had vide his letter dated 13-2-2018, informed the adjudicating authority about the glitches in the system. However, nothing about this is mentioned in the impugned OIO - appeal disposed off. Issues:1. Rejection of refund claims due to non-submission of GST RFD-01A printout.2. Appellant's grounds for appeal against the rejection of refund claims.3. Adjudicating authority's decision and legal implications.4. Appellate Authority's analysis and decision on the matter.Issue 1: Rejection of Refund ClaimsThe appellant filed three refund claims for ITC on export of goods and services without paying integrated tax. The adjudicating authority rejected the claims citing non-submission of online printout of Form GST RFD-01A. Despite the appellant's explanation of technical glitches preventing the printout, the authority issued a rejection order on the grounds of non-compliance with CGST Rules.Issue 2: Appellant's Grounds for AppealFeeling aggrieved by the rejection, the appellant raised concerns about the legality of the rejection order. They argued that the system glitches hindered the printout generation, and they subsequently obtained the required printout once the portal was functional. During a personal hearing, the appellant's representative reiterated these grounds.Issue 3: Adjudicating Authority's DecisionThe Commissioner analyzed the case and found that the rejection solely relied on the non-submission of GST RFD-01A printout. Referring to Circular No. 17/17/2017-GST, the Commissioner noted the mandatory requirement of submitting the printout with refund claims. However, considering the appellant's evidence of system issues and subsequent compliance, the Commissioner deemed the rejection unjust and corrected.Issue 4: Appellate Authority's DecisionThe Appellate Authority set aside the rejection orders, emphasizing that the appellant should not be penalized for portal glitches. The Commissioner highlighted the corrective re-credit of the electronic credit ledger by the adjudicating authority as per CGST Rules. The Commissioner criticized the mechanical approach of the adjudicating authority, noting the lack of mention of system glitches in the rejection order, which led to unjustly denying the refund and incurring interest liability on the department.In conclusion, the appeal was disposed of in favor of the appellant, overturning the rejection of refund claims based on the non-submission of the GST RFD-01A printout due to system glitches. The Commissioner emphasized the importance of considering technical issues faced by taxpayers and ensuring fair treatment in such cases.