High Court denies stay on CGST orders, emphasizes need for strong case. Application for relief rejected.

The High Court denied the application seeking a stay on two orders issued by the Assistant Commissioner of Central Goods and Service Tax. The court found no substantive challenge to the second order and could not entertain the application for interim relief. The main Petition challenging Rule 89(5) of the CGST Rules was already pending, and the court emphasized the need for a strong case to grant a stay on statutory rules. The court rejected the application for mandatory relief, stating it went against statutory provisions, and set a date for the final disposal of the main Petition in the following year.

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Issues:
1. Stay on the operation of Order-in-Original dated 10th January, 2019 and Order-in-Original dated 19th August, 2019 made by the Assistant Commissioner of Central Goods and Service Tax.
2. Challenge to Rule 89(5) of the CGST Rules regarding refund of input services.
3. Seeking interim relief contrary to statutory provisions.
4. Request for mandatory relief at the interim stage.

Analysis:

1. The applicant sought a stay on the operation of two orders issued by the Assistant Commissioner of Central Goods and Service Tax. The High Court noted that there was no substantive challenge to the second order dated 19th August, 2019. Since there was no challenge to this order, the court could not entertain the application seeking interim relief. The first order dated 10th January, 2019 was the subject of the main Petition challenging Rule 89(5) of the CGST Rules.

2. The main Petition challenged Rule 89(5) of the CGST Rules, which limits the refund of input services. The court had already issued a rule in the main Petition and granted liberty to the Petitioner to apply for interim relief if necessary. Granting the interim relief requested would essentially require the Respondents to act against the provisions of Rule 89(5) of the CGST Rules. The court emphasized that a strong case must be made beyond a prima facie case to grant a stay on legislation or rules with statutory force.

3. The relief sought by the Applicant effectively demanded a refund of an amount already held by the Respondents. Although styled as a request for a stay on the impugned orders, the nature of the relief was mandatory. The court found no justification for granting such mandatory relief at the interim stage, especially when it would go against statutory provisions.

4. Consequently, the High Court rejected the Civil Application for a stay, and no costs were awarded. The court also noted that the main Petition was scheduled for final disposal on a specific date, and accordingly, set a date for the final disposal of the main Petition in the following year.

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