Appellant denied refund for failing to adjust tax liability in GST returns as per CGST Act.

The appeals were disposed of with the conclusion that the appellant did not factually pay GST twice over as they had issued credit notes to negate the effect of the invoices/debit notes. The appellant failed to adjust the tax liability in the GST returns of the relevant months as required by Section 34 of the CGST Act, 2017, disqualifying them from claiming a refund under Section 54. The appellant's arguments were deemed irrelevant, and their refund claims were rejected.

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Issues Involved:
1. Whether the appellant factually paid GST twice over.
2. Whether there is a lawful bar or any procedural impediment to justify the rejection of the refund claims.
3. Whether the appellant is entitled to claim a refund of excess paid tax in terms of Section 54 of the CGST Act, 2017.

Detailed Analysis:

1. Whether the appellant factually paid GST twice over:
The appellant, engaged in the manufacture and supply of pharmaceutical products, filed refund claims under Section 54(3) of the CGST Act, 2017, citing excess payment of tax. The adjudicating authority issued show cause notices proposing rejection of these claims based on the issuance of multiple invoices and credit notes, which purportedly negated the excess tax payment. The appellant argued that due to clerical and human errors, they issued multiple credit and debit notes, resulting in the inadvertent double payment of GST, as evidenced by their GSTR-3B forms. The adjudicating authority, however, concluded that the appellant did not pay excess tax as they had issued credit notes to negate the effect of the invoices/debit notes.

2. Whether there is a lawful bar or any procedural impediment to justify the rejection of the refund claims:
The adjudicating authority referenced Section 34 of the CGST Act, 2017, which deals with the issuance of credit notes and the adjustment of tax liability. According to Section 34(2), any registered person issuing a credit note must declare the details in the return for the month during which the credit note was issued but not later than September following the end of the financial year or the date of furnishing the relevant annual return, whichever is earlier. The authority found that the appellant failed to adjust the tax liability in the GST returns of the relevant months, thus disqualifying them from claiming a refund as it was not a case of excess payment of tax.

3. Whether the appellant is entitled to claim a refund of excess paid tax in terms of Section 54 of the CGST Act, 2017:
The appellant contended that the adjudicating authority did not appreciate the factual situation and the documentary evidence showing duplicity of GST payment. They argued that the excess payment of tax should be refunded as per Section 54 of the CGST Act, 2017. However, the adjudicating authority held that since the case involved the issuance of credit notes and the adjustment of the corresponding tax liability, it fell under Section 34 of the CGST Act, 2017, and not Section 54. Therefore, the appellant was required to adjust the excess payment in the GST returns of the relevant months, which they failed to do.

Conclusion:
The appeals were disposed of with the conclusion that the appellant did not factually pay GST twice over as they had issued credit notes to negate the effect of the invoices/debit notes. The procedural law under Section 34 of the CGST Act, 2017, required the appellant to adjust the tax liability in the GST returns of the relevant months, which they failed to do. Consequently, the appellant was not entitled to claim a refund of excess paid tax under Section 54 of the CGST Act, 2017. The cited case laws by the appellant were found to be irrelevant to the instant case.

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