Erroneous refund proceedings may continue under GST recovery powers despite an unexercised appeal remedy and expired limitation.

Section 74(1) of the Odisha GST Act may be invoked to reopen an allegedly erroneous refund even where the refund had been granted after adjudication and was appealable under Section 107(1). In the absence of any express statutory bar, the availability of an appeal and the expiry of the appellate limitation period do not by themselves oust the power to issue a show cause notice under Section 74(1). The notice was therefore held to be within jurisdiction, and interference was declined, while the taxpayer was left free to raise other defences before the department.

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Issues: Whether a show cause notice under Section 74(1) of the Odisha Goods and Services Tax Act, 2017 could validly be issued to reopen an allegedly erroneous refund that had earlier been granted after adjudication, notwithstanding the availability of an appeal under Section 107(1) and the expiry of the appellate time limit.

Analysis: The relevant statutory scheme contained no express restriction on the exercise of power under Section 74(1) merely because the refund order was otherwise appealable under Section 107. The provision governing determination of tax not paid, short paid, or erroneously refunded did not distinguish between refunds granted after adjudication and refunds granted without adjudication. In the absence of any legislative bar, the mere failure to invoke the appellate remedy did not oust the power to proceed under Section 74(1).

Conclusion: The show cause notice was not without jurisdiction. The challenge to the notice failed on this ground.

Final Conclusion: The writ petition was disposed of by declining to interfere with the impugned notice, while leaving the petitioner free to raise all other defences before the department.

Ratio Decidendi: Where the statute does not impose a limitation, an erroneous refund may be proceeded against under Section 74(1) even if the refund order was appealable and no appeal was filed within time.

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