Taxpayers Must Disburse Rs. 61.79 Lakh Refund as Directed by Appellate Authority Under CGST Section 107

HC ruled that respondents must disburse the refund of Rs. 61,79,004.20 as directed by the Appellate Authority under Section 107 of CGST Act. The court emphasized compliance with the appellate order and noted that respondents' inability to file an appeal to the Tribunal does not justify withholding the refund. Respondents were directed to immediately disburse the refund while retaining their right to pursue statutory remedies.

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Issues involved:
The petition for directions to disburse refund claimed for the period March, 2020. Controversy over compliance with the order passed by the Appellate Authority.

Refund Claim Dispute:
The petitioner sought refund of input tax credit (ITC) for goods exported without tax payment in March, 2020. The Adjudicating Authority rejected most of the refund claim, citing wrongful ITC availed by the petitioner. Upon appeal under Section 107 of the CGST Act, the Appellate Authority substantially allowed the appeal, directing a refund of Rs. 61,79,004.20 and setting aside the rejection of the claim.

Non-Disbursement of Refund:
Despite the favorable decision by the Appellate Authority, the respondents failed to disburse the refund. The respondents claimed they were unable to file an appeal before the Appellate Tribunal due to its non-constitution. The respondents referred to the Central Goods and Services Tax (Ninth Removal of Difficulties) Order, 2019, extending the time period for filing an appeal before the Tribunal.

Judicial Decision:
The Court noted the controversy regarding the extension of limitation period by the Central Government and emphasized the respondents' obligation to comply with the Appellate Authority's order unless stayed by a competent authority or court. The Court relied on a previous decision and directed the respondents to immediately disburse the refund sanctioned by the Appellate Authority. The order clarified that the respondents could still pursue statutory remedies against the decision or seek recovery of the disbursed amount if successful in their remedies.

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