Manufacturer wins IGST refund case, court orders refund with interest.

The court ruled in favor of the petitioner, a manufacturer and exporter seeking a refund of IGST against two shipping bills. The court held that the petitioner was entitled to the IGST refund under the relevant provisions of the IGST Act and CGST Act, despite a dispute over duty drawback codes and the interpretation of a CBIC circular. The court directed the respondent to refund the IGST amounts claimed by the petitioner and ordered the payment of interest at a rate of 7% per annum from the date of correction due to the delay in granting the refund.

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Issues:
1. Refund of IGST paid on export of goods.
2. Claim for interest on delayed refund.
3. Dispute over duty drawback code.
4. Interpretation of CBIC circular.
5. Entitlement to IGST refund.
6. Applicability of higher duty drawback rate.
7. Delay in granting IGST refund.
8. Legal precedent from Gujarat High Court judgments.

Detailed Analysis:
1. The petitioner, a manufacturer and exporter of electrical connectors, sought a refund of IGST against two shipping bills. The refund amounts were claimed under Section 16 of the IGST Act read with Rule 96 of the CGST Rules. The petitioner had paid IGST at 28% of the export value and claimed refunds of Rs. 8,00,621/- and Rs. 8,25,349/- against the two shipping bills, respectively.

2. The petitioner mistakenly claimed duty drawback under the incorrect code initially but later applied for correction, which was allowed upon payment of fees and penalties. Despite the correction, the IGST refund was not granted, leading to the filing of the writ petition.

3. The respondent relied on a CBIC circular stating that exporters who opted for a higher rate of duty drawback could not claim IGST refund later. However, the court held that this circular did not apply in this case as the duty drawback rates were identical for both scenarios.

4. The court emphasized the petitioner's entitlement to the IGST refund under the relevant provisions of the IGST Act and CGST Act. The argument that the petitioner could not claim IGST refund due to the duty drawback claim at a higher rate was deemed factually incorrect.

5. Citing legal precedents from the Gujarat High Court, the court directed the respondent to refund the IGST against the shipping bills. Additionally, interest at the rate of 7% per annum was to be paid from the date of correction, considering the delay in granting the refund despite the correction being made in 2018.

6. The judgment highlighted the importance of following legal provisions and precedents to ensure timely and rightful refunds to exporters, emphasizing the petitioner's clear entitlement to the IGST refund in this case.

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