2023 (3) TMI 627 - HC - GST

High Court Upholds Tax Authority's Refund Denial, Directs Petitioner to Pursue Statutory Remedies Under Appellate Mechanism

HC dismissed the petitioner's challenge to refund claim rejection, emphasizing the availability of statutory alternative remedy under Central Excise Act ... Refund of service tax paid in cash along with the applicable interest under the transitional provision of Central Goods & Service Tax - It is the case of the petitioner that under Rule 6(3) of the Service Tax Rules, the petitioner is entitled to claim credit of the differential service tax paid in advance - HELD THAT:- While learned advocate for the petitioner raised various contentions on merits to assail the impugned order including on the aspect of applicability or otherwise of section 142(6)(a) of the Act, the Court does not find it necessary to go into all those contentions inasmuch as there is no gainsaying that the petitioner has alternative statutory remedy under section 35B of the Central Excise Act, 1994 read with section 86 in Chapter V of the Finance Act, 1994 read with section 174 of the Central Goods and Services Tax Act, 2017. Thereunder, the appeal is available to the appellate tribunal. It is trite that when the statutory alternative remedy is available, High Court would be slow to entertain the petition directly to exercise the writ jurisdiction. The petitioner is required to exhaust the statutory alternative remedy before invoking the extraordinary jurisdiction of this Court. The Court is of the view that the issues and aspects raised in the petition on merits with regard to the challenge to the impugned order and rejecting the refund claim of the petitioner could be better agitated before the appellate tribunal. While permitting the petitioner to approach the Tribunal, the present petition is dismissed on the said ground alone without expressing any opinion of the merits. Issues involved:The issues involved in the judgment are the rejection of a refund claim by the appellate authority and the petitioner's prayer to set aside the order-in-origin and order-in-appeal passed by the Deputy Commissioner and the Commissioner, GST & Central Excise (Appeals) respectively.Refund Claim Rejection:The petitioner, M/s. GAIL (India) Ltd., sought to set aside the order-in-origin and order-in-appeal to refund the service tax paid in cash along with applicable interest under the transitional provision of Central Goods & Service Tax. The petitioner claimed credit of the differential service tax paid in advance under Rule 6(3) of the Service Tax Rules. The transitional provisions under Chapter XX of the Central Goods and Service Tax Act were cited for the smooth transition of earlier claim of credits under the previous law. The petitioner's refund claim was rejected by the appellate authority, leading to the petition.Statutory Alternative Remedy:The Court acknowledged the petitioner's contentions challenging the impugned order but emphasized the availability of an alternative statutory remedy under section 35B of the Central Excise Act, 1994, read with section 86 of the Finance Act, 1994, and section 174 of the Central Goods and Services Tax Act, 2017. The Court highlighted that the petitioner must exhaust the statutory alternative remedy before seeking the extraordinary jurisdiction of the High Court. It was noted that the issues raised in the petition could be better addressed before the appellate tribunal, leading to the dismissal of the petition solely on the ground of the availability of the statutory alternative remedy.