2026 (3) TMI 578 - HC - GST

Refund claim review required where authority failed to address contractual, intermediary and IGST Act applicability; remand for fresh adjudication ordered.

The authority's rejection of a refund claim was set aside because it failed to adequately consider the petitioner's contractual arrangements, the ... Rejection of the refund of IGST on the ground that services were intermediary services and therefore not export of services - failure to consider petitioner\'s contentions regarding export of services versus intermediary - breach of the principles of natural justice as also non application of mind. Whether the impugned order requiring determination of whether the services qualified as export of services or intermediary services should be quashed and the matter remanded for fresh consideration - HELD THAT:- The Court found that the authority, in rejecting the refund claim, did not appropriately consider the petitioner's contentions and the contractual arrangements bearing on the question whether the services were export of services or intermediary services. Having noted relevant earlier decisions and circulars and the need for appropriate examination of the agreements and points urged by the petitioner, the Court concluded that the impugned order required reconsideration and directed remand for de novo consideration after hearing the parties. [Paras 4, 6, 8] Final Conclusion: The High Court quashed the impugned order rejecting the refund claim and remanded the matter to the authority for de novo consideration of whether the services qualify as export of services or intermediary services, with all contentions kept open and a three month timeline for fresh determination. Issues: Whether the impugned order dated 19.11.2025 rejecting the petitioner's refund claim ought to be quashed and the matter remanded to Respondent No.2 for de novo consideration.Analysis: The Court examined the record and the manner in which Respondent No.2 decided the refund application, noting that the authority did not adequately consider the petitioner's contentions regarding the contractual arrangements, the applicability of Section 13(8) of the IGST Act, 2017 and relevant circulars and precedents. The Court referred to analogous decisions where similar issues required detailed appellate re-examination and observed that the impugned order reflects insufficient appreciation of the points raised, including issues touching upon intermediary characterization and the applicability of export of services principles; accordingly, a fresh adjudication by the authority after hearing the parties is necessary.Conclusion: The impugned order dated 19.11.2025 is quashed and set aside and the proceedings are remanded to Respondent No.2 for de novo consideration and fresh decision in accordance with law within three months, with all contentions of the parties kept open.