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of <h1>Software glitches cannot deny IGST refund on zero-rated exports under Section 16(3)(b) of IGST Act</h1> <h3>Tulip Turnomatic Through Its Partner Neel Kothiya Versus Commissioner Of Customs & Ors.</h3> Tulip Turnomatic Through Its Partner Neel Kothiya Versus Commissioner Of Customs & Ors. - 2024:GUJHC:71313 - DB 1. ISSUES PRESENTED and CONSIDEREDThe core legal issues considered in this judgment include:Whether the petitioner is entitled to a refund of IGST paid on zero-rated supplies under Section 16 of the Integrated Goods and Service Tax Act, 2017, despite discrepancies in the PAN numbers associated with the shipping bill and GST returns.Whether the respondents are obligated to process the refund despite the technical mismatch in the PAN numbers, given the amendment of the shipping bill under Section 149 of the Customs Act, 1962.What remedies are available to the petitioner when procedural and technical issues prevent the automatic processing of a refund claimRs.2. ISSUE-WISE DETAILED ANALYSISIssue 1: Entitlement to Refund of IGSTRelevant legal framework and precedents: The petitioner relies on Section 16 of the IGST Act, which provides for zero-rated supplies, and Section 54 of the GST Act, which governs the refund process. Rule 96 of the CGST Rules outlines the procedure for claiming a refund.Court's interpretation and reasoning: The court recognized the petitioner's entitlement to a refund as per the statutory provisions, given that the goods exported qualify as zero-rated supplies.Key evidence and findings: The petitioner had complied with the necessary procedural requirements by filing the shipping bill and corresponding GST returns.Application of law to facts: The court applied the relevant statutory provisions to the facts, acknowledging that the petitioner met all formal requirements for a refund.Treatment of competing arguments: The respondent argued that the refund process is automated and contingent on matching data across systems, which was not possible due to a PAN mismatch.Conclusions: The court concluded that the petitioner is entitled to the refund, and the technical mismatch should not impede this entitlement.Issue 2: Obligation to Process Refund Despite Technical MismatchRelevant legal framework and precedents: Section 149 of the Customs Act, 1962, allows for amendments to shipping bills. Circular No. 15/2018-Customs was also referenced by the petitioner.Court's interpretation and reasoning: The court noted that the amendment of the shipping bill should have been reflected in the ICEGATE system to resolve the mismatch issue.Key evidence and findings: The petitioner had successfully amended the shipping bill to correct the IEC and GST numbers.Application of law to facts: The court determined that the amendment under Section 149 should facilitate the processing of the refund, notwithstanding the system's technical limitations.Treatment of competing arguments: The respondents maintained that the system's inability to process the refund due to the mismatch was a barrier. The court found this argument insufficient to deny the refund.Conclusions: The court directed the respondents to ensure the amendment is reflected in the system to enable the refund process.Issue 3: Remedies for Procedural and Technical IssuesRelevant legal framework and precedents: The court considered the procedural aspects under the GST and Customs frameworks and the administrative actions taken by the petitioner.Court's interpretation and reasoning: The court acknowledged the petitioner's proactive steps to resolve the issue through various administrative channels.Key evidence and findings: The petitioner's repeated attempts to rectify the issue through the GSTN and ICEGATE help-desks were documented.Application of law to facts: The court applied principles of administrative justice, recognizing the petitioner's efforts and the inadequacy of the system's response.Treatment of competing arguments: The respondents did not provide a viable alternative solution to the technical problem, which the court found unacceptable.Conclusions: The court ordered the respondents to address the technical issue and process the refund within eight weeks.3. SIGNIFICANT HOLDINGSPreserve verbatim quotes of crucial legal reasoning: 'Considering the above submissions, it appears that the petitioner is the victim of computer software. It appears that there is no system to give effect of amendment of the shipping bill in the ICEGATE so as to remove the mismatch between the PAN of GST and ID and Shipping Bills GST ID.'Core principles established: The judgment reinforces the principle that technical and procedural issues should not obstruct the rightful claims of taxpayers under statutory provisions.Final determinations on each issue: The court directed the respondents to amend the system to reflect the corrected shipping bill details and process the refund within eight weeks, ensuring the petitioner's entitlement is honored.The judgment underscores the importance of administrative efficiency and the need for systems to adapt to ensure compliance with legal entitlements, particularly in the context of automated processes under tax laws.
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