Revenue ordered to refund Rs.11,21,840 from bank guarantee within one month, petitioner must provide fresh guarantee

Karnataka HC directed revenue to refund Rs.11,21,840 encashed from bank guarantee within one month. Court ordered petitioner to provide fresh bank guarantee valid for one year within one week of receiving refund. Revenue must withdraw recovery proceedings upon refund. Petition disposed of with directions for mutual compliance by both parties regarding bank guarantee replacement process.

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Issues involved: Writ of mandamus for withdrawal of recovery proceedings, writ of certiorari to set aside impugned order, refund of amount, constitution of GSTAT for appeal, circular dated 18.03.2020 on appeal process.

The petitioner sought a writ of mandamus to direct the Respondent to withdraw recovery proceedings by issuing a demand draft equivalent to the Bank Guarantee amount. Additionally, a writ of certiorari was requested to set aside the impugned order dated 16.09.2023. The petitioner also sought various other reliefs, including the refund of a specific amount and the option to challenge the impugned order through a statutory appeal once the GSTAT is constituted.

The learned counsel for the petitioner argued that due to the non-constitution of the GSTAT, the petitioner was unable to appeal the impugned order. The counsel requested the court to allow the appeal once the GSTAT is established. The respondent, represented by learned AGA, agreed to refund the specified amount to the petitioner upon the condition of furnishing a bank guarantee within a week from the refund date.

The Circular dated 18.03.2020 provided guidelines on the appeal process in the absence of the appellate tribunal. It clarified the procedures for making appeals under the Central Goods and Services Tax Act, emphasizing the role of the Appellate Authority and the Appellate Tribunal in the appeal process.

The court, considering the circumstances, directed the respondent to refund the specified amount encashed earlier within a month. It further instructed the petitioner to provide a fresh bank guarantee within a week of the refund, valid for a year. The petitioner was granted liberty to file a statutory appeal challenging the impugned order once the GSTAT is constituted, following the extended period of limitation as per the circular dated 18.03.2020. The petition was disposed of accordingly.

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