IGST refund cannot be denied solely for late Bond/LUT filing where exports are otherwise proved and ex post facto compliance is permitted.

Refund of IGST could not be rejected solely because Bond/LUT was not furnished before export where exports were otherwise established and the defect was capable of ex post facto compliance under the 15.03.2018 circular issued under the CGST Act. The Karnataka HC held that the authority had treated the requirement as an absolute bar without considering the circular, and that such rejection could not stand on that basis alone. The refund refusal was set aside and the application was remanded for fresh consideration in accordance with law and the circular.

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Issues: Whether refund of IGST could be rejected solely for non-furnishing of Bond/LUT before export, and whether the matter had to be reconsidered in light of the 15.03.2018 circular permitting delayed filing and ex post facto compliance.

Analysis: The refund rejection rested only on the absence of a Bond/LUT before export. The Court noted that the circular issued under section 164(1) of the Central Goods and Services Tax Act, 2017 clarified that the substantive benefit of zero-rating should not be denied where exports were otherwise established, and that delay in furnishing the Bond/LUT may be condoned on ex post facto basis depending on the facts of the case. The impugned order had not considered this circular and had treated the requirement as an absolute bar. In view of the circular and the nature of the defect, the rejection could not be sustained without fresh consideration.

Conclusion: The rejection of refund for want of prior Bond/LUT was set aside and the refund application was sent back for reconsideration in accordance with law and the circular.

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