2025 (10) TMI 1123 - SCH - GST

Unutilized cess ITC refundable when IGST paid under Section 16(3) on zero-rated exports; proviso to Section 11(2) inapplicable

SC dismissed the special leave petition and declined to exercise jurisdiction under Art. 136, thereby upholding the HC's conclusion that the petitioner is ... Entitlement for refund of unutilized Input Tax Credit (ITC) qua Cess - zero-rated supplies - goods manufactured for export - Validity of Circular No.125/44/2019-GST-as well as para-5 of the Circular No.45/19/2018-GST issued under Section 168 - challenged the show cause notice and the order of sanction of refund - it was held by High Court that 'when the petitioner has paid the IGST under Section 16(3) of the IGST Act on the zero rated supply and refund is claimed by the payment of such IGST, the petitioner admittedly would not be able to utilize input tax credit of cess as cess is not payable on the zero rated supply. Therefore, proviso to Section 11(2) of the Act would not be applicable in the facts of the case and the petitioner would be entitled to refund of the unutilized input tax credit on cess paid on purchase of coal utilized for the purpose of manufacture of goods which are exported.' HELD THAT:- It is not deemed necessary to exercise jurisdiction under Article 136 of the Constitution of India - SLP dismissed. 'Delay condoned.' The Court, noting the absence of the respondent, states that 'in view of the finding recorded in paragraph 21 of the impugned order, we do not deem it necessary to exercise our jurisdiction under Article 136 of the Constitution of India.' Consequentially, the 'Special Leave Petition is dismissed leaving the question of law, if any, open.' All 'pending application(s), if any, shall stand disposed of.' The decision rests on the impugned order's paragraph 21, and the Court expressly refrains from invoking its extraordinary jurisdiction under Article 136, thereby limiting its intervention to leave dismissal while not pronouncing on any substantive question of law that may remain. Procedural relief sought is therefore denied, with ancillary applications concluded.