Appellate authority affirms refund decision based on correct processing of application.

The appellate authority upheld the adjudicating authority's decision, finding no infirmity in the order. The adjudicating authority correctly processed the refund application by taking the net ITC, the FOB value as the total turnover of zero-rated supply, and the adjusted total turnover in compliance with the provisions of law. The appeal was rejected, and the original order was upheld.

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Issues Involved:
1. Correctness of turnover and adjusted turnover for refund calculation.
2. Disallowance of ITC based on turnover of sale of services.
3. Interpretation of circulars regarding values declared in invoices and shipping bills.
4. Refund eligibility based on input tax credit (ITC) paid.

Detailed Analysis:

1. Correctness of Turnover and Adjusted Turnover for Refund Calculation:
The appellant argued that the turnover and adjusted turnover were not correctly taken for the purpose of granting a refund. According to Rule 89, the refund amount should be calculated using the formula:
\[ \text{Refund Amount} = \left(\text{Turnover of zero-rated supply of goods} + \text{Turnover of zero-rated supply of services}\right) \times \frac{\text{Net ITC}}{\text{Adjusted total turnover}} \]
The appellant claimed the turnover of zero-rated supply of goods as Rs. 2,89,44,004.19 and the turnover of zero-rated supply of services as Rs. 1,14,56,668.02, leading to an eligible refund amount of Rs. 12,60,432.22 against their claimed refund of Rs. 11,20,418. The adjudicating authority, however, took the zero-rated turnover as Rs. 2,89,44,004 and the adjusted total turnover as Rs. 4,17,91,104, leading to a refund of Rs. 9,07,029 and rejecting Rs. 2,13,389.

2. Disallowance of ITC Based on Turnover of Sale of Services:
The appellant contended that ITC was disallowed based on the turnover of sale of services amounting to Rs. 1,14,56,668.02. They argued that they had not availed ITC on services by way of transportation of goods by air or sea from the customs station of clearance in India to a place outside India (ocean freight), thus no disallowance should arise. The adjudicating authority, however, maintained that the value of zero-rated supply of services should not be included in the calculation of the refund amount.

3. Interpretation of Circulars Regarding Values Declared in Invoices and Shipping Bills:
The appellant argued that the adjudicating authority wrongly interpreted the circulars by taking the values declared in the invoice and the value of goods declared in the shipping invoice for granting the refund. According to Circular No. 37/11/2018-GST and Circular No. 125/44/2019-GST, the lower of the two values should be sanctioned as a refund. The adjudicating authority adhered to this interpretation, taking the lower value between the GST invoice and the shipping bill for calculating the refund amount.

4. Refund Eligibility Based on Input Tax Credit (ITC) Paid:
The appellant claimed that they had paid ITC of Rs. 13,09,623 during the relevant period, out of which Rs. 1,89,205 was related to an invoice for which the refund was already received from the customs department. Therefore, they claimed a refund only on the net balance of Rs. 11,20,418. The adjudicating authority, however, processed the refund application in strict compliance with the provisions of law, considering the net ITC as Rs. 13,09,623, the FOB value as the total turnover of zero-rated supply (Rs. 2,89,44,004), and the adjusted total turnover as Rs. 4,17,91,104.

Conclusion:
The appellate authority upheld the adjudicating authority's decision, finding no infirmity in the order. The adjudicating authority correctly processed the refund application by taking the net ITC, the FOB value as the total turnover of zero-rated supply, and the adjusted total turnover in compliance with the provisions of law. The appeal was rejected, and the original order was upheld.

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