LTU refund jurisdiction and prospective circular amendment barred rejection of pending claims on procedural grounds.

Refund claims filed when the LTU had jurisdiction could not be rejected later for lack of jurisdiction merely because the assessee exited the LTU; the pending claims had to be transferred to the competent authority and decided on merits after due process. The remand for verification was unsustainable because the original authority had already examined refund entitlement and recorded findings on compliance with Circular No. 74/2001. The 2017 amendment to the circular could not be used to disturb earlier claims, as it was treated as prospective in this context. The jurisdictional rejection and remand were set aside, and the claims were directed to be decided in accordance with law and natural justice.

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Issues: Whether refund claims filed before the LTU could be rejected on the ground of lack of jurisdiction after the assessee exited the LTU, whether the remand directed for verification was sustainable, and whether the 2017 amendment to Circular No. 74/2001 could be applied retrospectively.

Analysis: The refund claims had been filed when the LTU had jurisdiction, and the show-cause notice did not allege lack of jurisdiction. After the assessee exited the LTU, the department was required to route the pending claims to the proper jurisdictional authorities and decide them on merits after due process. The rejection of refund solely on jurisdictional grounds was therefore not sustainable. The order of remand for verification was also found unsustainable because the original authority had already examined the refund entitlement in detail and recorded findings on compliance with Circular No. 74/2001. The later amendment introduced in 2017 could not be applied to disturb the earlier claims since the circular was held to operate prospectively in the present context.

Conclusion: The jurisdictional rejection and the remand order were set aside, and the pending refund claims were directed to be decided by the competent authorities in accordance with law and principles of natural justice.

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