2017 (10) TMI 693 - HC - GST

Court grants interim relief to Petitioner facing IGST payment issues for imported goods

The Court granted interim relief to the Petitioner in a case concerning relief measures for exporters by the Goods and Service Tax Council. Despite the ... Interim relief against payment of IGST on imports under Advance Authorisation - prima facie effect of GST Council press release - deemed exports under Section 147 of CGST/SGST - refund of IGST on exports - letter of undertaking for provisional clearance - customs verification of imported goodsInterim relief against payment of IGST on imports under Advance Authorisation - prima facie effect of GST Council press release - deemed exports under Section 147 of CGST/SGST - Petitioner not required, pending further orders, to pay IGST in respect of imports made under the Advance Authorisations furnished to it. - HELD THAT: - Having placed before the Court the GST Council press release dated 6 October 2017 announcing relief measures for exporters (including extension of AA/EPCG/EOU treatment and provision for refunds), the Court observed that the press release prima facie makes no distinction between AAs issued before or after 1 July 2017. In view of that prima facie position and until the formal notification is issued or further orders are made, the petitioner shall not be required to pay IGST on imports of gold bars made pursuant to the Advance Authorisations issued to it. The interim relief is provisional and founded on the announced policy measures and their apparent applicability to the petitioner's AAs. [Paras 5]Interim stay of requirement to pay IGST on imports under the petitioner's Advance Authorisations, subject to conditions set out by the Court.Letter of undertaking for provisional clearance - customs verification of imported goods - Interim relief granted subject to the petitioner furnishing a letter of undertaking and to customs verification of the goods. - HELD THAT: - The Court conditioned the provisional relief on the petitioner furnishing to the respondent authorities a letter of undertaking that clearance in terms of the AA will be subject to the final result of the petition. The Court also directed that the imported goods shall remain liable to verification by the Customs Department in accordance with law. These conditions preserve the respondents' ability to verify and determine entitlement while permitting provisional non-payment of IGST. [Paras 6]Relief is subject to petitioner furnishing an undertaking and to customs verification of the imported goods.Procedural filing of affidavit - Petitioner directed to file an affidavit setting out the facts regarding payment and clearance of imported goods and serve an advance copy on the respondents. - HELD THAT: - The Court directed the petitioner to place the facts (including production of the e-challan showing payment and the circumstances of clearance) on affidavit to be filed within three days and to serve an advance copy on the respondents so that the respondents may obtain instructions prior to the next hearing. This procedural direction was given to enable fuller consideration on the returnable date. [Paras 4]Petitioner to file the specified affidavit within three days and serve an advance copy on the respondents.Final Conclusion: On the basis of the GST Council's press release of 6 October 2017, the Court granted interim relief directing that the petitioner need not pay IGST on imports made under its Advance Authorisations pending final disposal, subject to the petitioner furnishing a letter of undertaking and to customs verification; the petitioner was also ordered to file an affidavit within three days. Issues:1. Relief measures announced by the Goods and Service Tax Council for exporters.2. Non-clearance of goods due to IGST payment despite relief measures.3. Petitioner's plea for relief from IGST payment for imported goods.4. Interim relief granted to the Petitioner pending final decision.Analysis:1. The judgment pertains to relief measures announced by the Goods and Service Tax Council for exporters, including the clearance of held-up refunds of IGST, processing of refunds for subsequent months, and empowerment of GST officers for expedited refunds. Additionally, the Council approved immediate relief for exporters to prevent cash blockage by extending schemes for sourcing inputs from abroad and domestic suppliers.2. Despite the relief measures announced, the Petitioner faced a situation where they were not allowed to clear imported goods without paying IGST. The Petitioner's counsel highlighted the payment of IGST for imported gold bars and the authorities' refusal to permit clearance despite the Petitioner's protests.3. In response to the Petitioner's plea, the Court directed the Petitioner to submit an affidavit detailing the IGST payment issue within three days. Considering the press release by the GST Council and the lack of distinction regarding Advance Authorisations issued before or after 1st July 2017, the Court granted interim relief to the Petitioner. The Petitioner was exempted from paying IGST for imported gold bars under the AA, subject to providing a letter of undertaking and verification by the Customs Department.4. As an interim measure, the Court granted relief to the Petitioner pending the final decision on the petition. The case was listed for further proceedings on 28th November 2017, with the order to be provided under the signature of the Court Master for immediate action.