Tax Refund Dispute Resolved: Petitioner Directed to File Representation, Independent Review Ordered for Rs. 52.97 Crore Claim

HC ruled on tax refund dispute involving exported goods. Court found conflicting claims about invoice mismatch and directed petitioner to file representation to Adjudicating Authority. A new Assistant Commissioner was assigned to independently review the claim for interest on delayed refund within 12 weeks, ensuring impartial assessment of the Rs. 52.97 Crores tax refund application.

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Issues:
1. Refund of tax paid on exported goods under IGST Act.
2. Nonpayment of interest on refunded amount.
3. Invoice mismatch causing delay in refund.
4. Entitlement to interest on delayed refund.
5. Adjudication by the authorities.

Analysis:
1. The petitioner sought a refund of Rs. 52.97 Crores with interest under Section 56 of the Central Goods & Service Tax Act for tax paid on exported goods under IGST Act. During the case, Rs. 52.52 Crores was refunded, leaving a balance of Rs. 2.35 Crores. The petitioner claimed entitlement to interest on the refunded amount after 60 days of filing shipping bills.

2. The respondents argued that an invoice mismatch caused the delay in refunding the amount. They contended that no interest was payable by the Revenue for the delay as it was due to the petitioner's error. The petitioner disputed the mismatch, citing Circulars and FAQs directing refund even in cases of invoice errors.

3. The court found conflicting claims regarding the invoice mismatch and the responsibility for the delay. It was decided that factual determination was necessary to ascertain the type of mismatch, responsible party, and corrective actions. The court directed the petitioner to file a representation to the Adjudicating Authority for further consideration.

4. The representation was advised to be made to a different Assistant Commissioner of Customs due to concerns regarding impartiality. The court emphasized the need for justice to not only be done but also appear to be done. The new officer was instructed to adjudicate the claim for interest on the delayed refund and the pending refund application within twelve weeks.

5. The new officer was directed to independently analyze the facts and applicable laws without influence from the previous affidavit. The decision was to be made considering the petitioner's claim of no mistake warranting denial of interest for the delayed refund. The petition was disposed of with no order as to costs.

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