Budgetary support claim rejected for filing monthly applications instead of prescribed quarterly procedure under scheme

The Sikkim HC dismissed a writ petition challenging rejection of budgetary support claims for July and August 2017. The petitioner filed separate monthly applications instead of following the prescribed quarterly filing procedure under the Budgetary Support Scheme. The court held that budgetary support is a grant requiring strict compliance with prescribed procedures, not a tax refund. The scheme mandated quarterly claims and calculations, which the petitioner failed to follow despite circulars clarifying the requirements. The court found no malice in the authorities' rejection, noting the petitioner received support for other quarters where proper procedures were followed. The petition was dismissed for non-compliance with statutory requirements.

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Issues Involved:
1. Rejection of petitioner's claim for budgetary support for July-September 2017.
2. Alleged violation of principles of natural justice.
3. Interpretation of the Budgetary Support Scheme and relevant circulars.
4. Entitlement to interest on delayed budgetary support.

Summary of Judgment:

1. Rejection of Petitioner's Claim for Budgetary Support for July-September 2017:
The petitioner's claim for budgetary support for July-September 2017 was rejected, leading to the present litigation. The petitioner argued that their initial claims for July and August 2017 should have been considered separately, but the Assistant Commissioner, Central Goods & Service Tax (respondent no. 3) maintained that the Budgetary Support Scheme required claims to be filed on a quarterly basis.

2. Alleged Violation of Principles of Natural Justice:
The petitioner contended that there was a violation of principles of natural justice as no personal hearing was granted. However, the Court found no violation because the petitioner was allowed to resubmit applications for budgetary support, and three out of four claims were accepted. The Court noted that the petitioner had no grievance regarding the accepted claims, indicating no violation of natural justice.

3. Interpretation of the Budgetary Support Scheme and Relevant Circulars:
The petitioner argued that the rejection was due to an erroneous interpretation of the Budgetary Support Scheme and Circulars dated 27.11.2017 and 10.01.2019. The petitioner claimed budgetary support for July and August 2017 separately, citing the Circular dated 10.01.2019. The respondents countered that the Budgetary Support Scheme required claims to be filed and worked out on a quarterly basis. The Court examined the Budgetary Support Scheme and the relevant circulars, concluding that the Scheme mandated quarterly claims, and the Circular dated 10.01.2019 did not permit monthly claims. The petitioner's separate claims for July and August 2017 were not in line with the Scheme's requirements.

4. Entitlement to Interest on Delayed Budgetary Support:
The petitioner claimed entitlement to interest due to the delay in sanctioning the budgetary support. The respondents argued that the Budgetary Support Scheme did not envisage any interest on such claims as the support was a grant, not a refund under taxation law. The Court agreed with the respondents, stating that the Scheme did not provide for interest on delayed budgetary support.

Conclusion:
The Court dismissed the writ petition, stating that the petitioner did not follow the prescribed procedure under the Budgetary Support Scheme and the relevant circulars. The petitioner's claim for budgetary support for July-September 2017 was correctly calculated in the negative due to the balance of ITC of CGST for September 2017. The Court found no merit in the petitioner's claims and upheld the respondents' decision. The parties were directed to bear their respective costs.

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