Taxpayer Wins GST Refund Battle: Manual Applications Valid, Electronic Filing Not Sole Determinative Criteria for Claims

The SC examined a GST refund dispute, finding the petitioner's manual refund applications valid under Rule 97A. The Court criticized the respondent's rejection based on a circular, emphasizing that registration timing and electronic filing requirements should not impede refund claims. The writ petition was allowed, with the matter remitted for fresh consideration and costs awarded to the petitioner.

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Issues involved:
The petitioner assails the order declining to consider applications for refund of GST for multiple financial years, citing reasons related to application form, registration under the Central Goods and Services Tax Act, and mode of filing refund applications.

Refund Application Process:
The petitioner informed the respondent about its GST registration and the transfer of eligible ITC, seeking to file refund applications under the "Inverted Duty Structure" for the relevant financial years. Despite being unable to file electronically due to registration timing, the petitioner submitted manual applications through separate emails, requesting consideration.

Legality of Manual Applications:
The Court found that the petitioner's reasons for manual filing were valid, as Rule 97A of the Central Goods and Services Tax Rules permits manual applications, contrary to a circular mandating electronic filing. Emphasizing that circulars cannot override rules, the Court criticized the 5th respondent for rejecting manual applications based on the circular, emphasizing the legality of manual filing under Rule 97A.

Precedents and Legal Standing:
Citing judgments from the Bombay High Court and the Gujarat High Court, the Court highlighted the precedence of Rule 97A in allowing manual filing of refund applications, emphasizing that assessing authorities cannot insist on electronic filing only, thereby supporting the petitioner's stance on the mode of application submission.

Registration Requirement for Refund:
Regarding the petitioner's registration status, the Court referred to Section 54(1) permitting any person to apply for a refund of tax, emphasizing that the petitioner's registration status at a specific time should not hinder its eligibility for seeking a refund. Additionally, the Court noted Rule 41 concerning credit transfer in cases of amalgamation or merger, which the 5th respondent failed to consider.

Judgment and Remittance:
Consequently, the Court allowed the writ petition, setting aside the impugned order and remitting the matter to the 5th respondent for fresh consideration within a specified timeline. The 5th respondent was directed to pay costs to the petitioner, and pending applications were disposed of accordingly.

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