Refund claim after appellate relief cannot be defeated by fresh deficiency objections or repeat procedural demands.
After a refund claim for input tax credit on zero-rated supplies had been partly allowed in appeal, the authorities could not withhold implementation by raising a fresh deficiency objection or demanding further supporting documents. The appellate proceedings were treated as a continuation of the original claim, so the taxpayer was not required to file a repeat refund application or furnish a fresh undertaking once entitlement had already been determined. The related request in Form GST PMT-03 also had to be processed, and the refund accepted in appeal was to be sanctioned with applicable interest.
Issues: (i) Whether refund of input tax credit relating to zero-rated supplies could be withheld or rejected on a fresh deficiency objection after the refund claim had been partly allowed in appeal; (ii) Whether the petitioner was required to file a repeated refund application and furnish an additional undertaking after succeeding in appellate proceedings; (iii) Whether the request in Form GST PMT-03 was liable to be processed.
Issue (i): Whether refund of input tax credit relating to zero-rated supplies could be withheld or rejected on a fresh deficiency objection after the refund claim had been partly allowed in appeal.
Analysis: The refund claim had been made under Section 54(3)(i) of the Central Goods and Services Tax Act, 2017. The appellate authority had already examined the rejection orders and granted refund to the extent admissible. Once the appellate orders had settled the entitlement, the authorities could not introduce a new deficiency memo or insist on further supporting documents to deny implementation of the appellate decision.
Conclusion: The objection was unsustainable and the refund could not be withheld on that basis.
Issue (ii): Whether the petitioner was required to file a repeated refund application and furnish an additional undertaking after succeeding in appellate proceedings.
Analysis: The appellate proceedings were treated as a continuation of the original refund claim. The Court held that a taxpayer is not required to make repeated applications for the same refund claim once entitlement has been determined in appeal. The proposed insistence on a further undertaking with reference to compliance under Section 16(2)(c) of the Central Goods and Services Tax Act, 2017 read with Section 42(2) of the Central Goods and Services Tax Act, 2017 could not justify non-processing where the required declarations had already been furnished earlier.
Conclusion: The petitioner was not required to file a repeat application or furnish a fresh undertaking, and the appellate orders had to be implemented.
Issue (iii): Whether the request in Form GST PMT-03 was liable to be processed.
Analysis: Since the refund claim had been accepted to the extent ordered in appeal, the ancillary request in Form GST PMT-03 also required consideration in accordance with law.
Conclusion: The request in Form GST PMT-03 was directed to be processed.
Final Conclusion: The respondent was directed to sanction the refund accepted in appeal with applicable interest and to process the related PMT-03 request, thereby granting the petitioner substantive relief.
Ratio Decidendi: After a refund claim has been adjudicated in appeal, the revenue cannot defeat implementation of the appellate order by insisting on a fresh deficiency or repeated procedural compliance for the same claim.
TaxTMI 
AI Drafter ✕
TaxTMI 
