Landmark GST Dispute: Appellate Authority Ordered to Resolve Refund Appeal Within Six Weeks, Ensuring Procedural Fairness

HC addressed a GST dispute involving disputed tax deposit of Rs. 14,32,32,135 and refund rejection. The court directed the appellate authority to resolve the petitioner's refund appeal within six weeks, emphasizing timely adjudication without prejudicing the petitioner's right to challenge the show cause notice terms. The ruling focused on procedural fairness and expeditious resolution of tax-related grievances.

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Issues:
The issues involved in the judgment are the impugning of Show Cause Notices under the provisions of Section 74 of the Central Goods and Services Tax Act 2017, seeking refund of a sum of Rs. 14,32,32,135 forcibly collected, rejection of refund application, and pending appeal for refund.

Impugned Show Cause Notices:
The petitioner challenged the Show Cause Notices dated 11.11.2022 seeking relief and alternative reliefs. The petitioner specifically sought directions for the expeditious disposal of the appeal for refund of the amount collected by the respondents and for the grant of the refund less the pre-deposit of 10% of the tax component. The petitioner confined the petition to these alternative reliefs.

Deposit and Refund Rejection:
The petitioner deposited Rs. 14,32,32,135 on 03.08.2021, which was allegedly not voluntary, as demonstrated by the circumstances of detention and lack of acknowledgment. The refund application in FORM GST RFD-06 was rejected on 04.08.2023, and the appeal against this rejection is pending. There was an apprehension that the amount deposited might be appropriated before the appeal is concluded.

Contentions and Conclusions:
The petitioner argued that the deposit was not voluntary, while the respondents contended that it was voluntary, as requested for closure of proceedings. The rejection of the refund application was based on the conclusion that the deposit was voluntary. However, the court held that the merits of this conclusion should be considered in the pending appeal. The court referred to a Division Bench decision and an Instruction, emphasizing that the appeal authority must consider the petitioner's grievance in a time-bound manner.

Order:
The court disposed of the petition by directing the sixth respondent to dispose of the petitioner's appeal against the refund rejection order within six weeks from the first hearing after the order. It was clarified that this disposal does not imply the petitioner giving up the grievance against the Show Cause Notice terms.

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