GST refund on leasehold transfer: assignment treated as nonsupply, refund to be paid within two weeks after application.

Assignment of leasehold rights for consideration is treated as transfer of benefits arising from immovable property and therefore falls outside the statutory scope of supply, so the transaction is not taxable as a supply of goods or services under the GST framework; consequence: tax paid on such leasehold transfer is refundable. A deficiency memo rejecting the refund application for illegible documents and absence of a GST Council notification was issued, but the state accepted that a fresh refund application will be considered and ordered payment of the refund within two weeks of receipt. Parties are anonymised and procedural defects were waived pending application.

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Issues: Whether the petitioner is entitled to refund of GST paid on assignment/transfer of leasehold rights in land and whether the refund application should be considered and paid in accordance with the Court's earlier decision in Gujarat Chamber of Commerce and Industry v. Union of India.

Analysis: The petition challenges Deficiency Memos refusing the refund claim and relies on the High Court's prior decision holding that assignment/transfer of leasehold rights in land constitutes sale/transfer of immovable property and does not amount to supply liable to GST. The respondents have communicated that on filing an application for refund the claim will be considered and refund paid. The Court directs the petitioner to file the refund application and requires the tax authority to process and pay the refund within two weeks of receipt, thereby operationalising the legal position reflected in the earlier decision.

Conclusion: The petitioner is entitled to have the refund application considered and the refund paid; on filing the application the refund shall be paid within two weeks. The petition is disposed accordingly.

Final Conclusion: The order implements the entitlement of the petitioner to obtain refund in line with the earlier decision that assignment/transfer of leasehold rights in land is akin to sale of immovable property and not a supply under the GST law, by directing prompt consideration and payment of the refund on filing of the application.

Ratio Decidendi: Assignment or transfer of leasehold rights in land by the lessee to a third party is a transfer of benefits of immovable property equivalent to sale and does not constitute a taxable supply under the GST framework; accordingly refund of tax paid on such transactions is allowable and must be processed under Section 54 of the GST Act.

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