Importer entitled to IGST refund on ocean freight as separate levy violates composite supply provisions under Sections 2(30) and 8 CGST Act

The HC disposed of a writ petition regarding IGST refund on ocean freight, following SC precedent in Mohit Minerals case. The court held that separate IGST levy on shipping services violates composite supply provisions under Sections 2(30) and 8 of CGST Act, as the importer already pays IGST on the entire CIF contract including goods and services. The petitioner was granted entitlement to IGST refund, with respondents directed to process the refund within six weeks in accordance with law.

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Issues involved:
The writ petition seeks to quash specific notifications and orders related to GST, claiming refund and interest, based on the judgment of the Supreme Court in Union of India Vs. Mohit Minerals (Pvt.) Limited.

Quashing of Notifications and Orders:
The petitioner requested the quashing of various notifications and orders related to GST, citing the judgment in Union of India Vs. Mohit Minerals (Pvt.) Limited. The High Court observed that the issue raised in the petition aligns with the Supreme Court's judgment, indicating that the reliefs sought by the petitioner are valid. The submissions made by the petitioner's counsel were undisputed by the respondents' counsel.

Observations and Directions of the Supreme Court:
In the case of Mohit Minerals (Pvt.) Limited, the Supreme Court highlighted the erroneous implementation of GST due to misconceptions in the legislation. The Court emphasized that levying additional taxes on components of supply, already covered under GST, is impermissible. The Court concluded that the notifications imposing tax on services, already included in the composite supply of goods, are illegal and should be struck down. The recommendations of the GST Council were deemed non-binding on the Union and States, emphasizing the collaborative nature of decision-making in GST matters.

Disposition of the Writ Petition:
Based on the alignment of the petitioner's case with the Mohit Minerals judgment, the High Court disposed of the writ petition in favor of the petitioner. The petitioner was granted the refund of the IGST paid, with instructions for the respondents to process the refund within six weeks from the date of the order, in compliance with the law.

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