2025 (1) TMI 714 - HC - GST

AP HC Overturns Denial of TDS Refund; Case Remanded for Reconsideration Under CBIC Circular, Completion in 3 Months.

The AP HC set aside the orders of the Assessing and Appellate Authorities, which had denied the petitioner's refund of TDS amounts in the cash ledger ... Refund of the left over TDS in the cash ledger, after his tax liability was discharged by using ITC available in his ledger - violation of Principle of Unjust Enrichment - HELD THAT:- The order of the Appellate Authority, is in a manner of speaking, superseded by the circular, issued by the Central Board of Indirect Taxes and Customs, dated 17.11.2021, bearing Circular No. 166/22/2021-GST, wherein refund of TDS/TCS amounts deposited in the electronic cash ledger is permissible, in accordance with the proviso to sub-section (1) of section 54, read with subsection (6) of section 49 of C.G.S.T. Act. This Court deems it appropriate to dispose of this Writ Petition by setting aside the Order-in-Appeal bearing No. ZH371220OD95299, dated 26.12.2020 and the Order-in-Original bearing No. ZL3710190623900, dated 17.10.2019 and remanding the matter back to the respective respondents for reconsideration in the light of Circular No.166/22/2021-GST. Petition disposed off. In the case before the Andhra Pradesh High Court, the petitioner, a registered dealer under the Goods and Services Tax Act, 2017, sought a refund of the accumulated TDS amounts in the cash ledger after discharging tax liability using available ITC. The Assessing Authority initially rejected this refund application on October 17, 2019, citing the 'Principle of Unjust Enrichment.' The Appellate Authority upheld this decision, leading the petitioner to file a Writ Petition with the High Court.The petitioner's counsel argued that a subsequent circular issued by the Central Board of Indirect Taxes and Customs (Circular No. 166/22/2021-GST, dated November 17, 2021) allows for the refund of TDS/TCS amounts deposited in the electronic cash ledger, as per the proviso to sub-section (1) of section 54, read with subsection (6) of section 49 of the CGST Act.The High Court, acknowledging this circular, set aside both the Appellate and Original orders and remanded the matter back to the respective authorities for reconsideration in light of the new circular. The court directed that this reconsideration be completed within three months from the date of receipt of the order and noted that there would be no order as to costs. Pending interlocutory applications were also closed.