GST refund rejection fails where the service agreement and export-of-services character are not properly examined.

Refund rejections under the GST regime may not be sustained where the appellate authority does not examine the governing service agreement or record findings on whether the supply is an export of services or an intermediary service. The text notes that, in relation to IGST refund claims on ship management services, the absence of findings on the contractual terms and the true character of the supply meant the orders could not stand. The impugned refund rejection orders were quashed, and the matters were remanded for de novo consideration and fresh orders after hearing the parties.

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Issues: Whether the orders rejecting refund claims under the GST regime could be sustained when the appellate authority had not recorded a finding on the contractual terms governing the service arrangement and the consequent characterisation of the supply as export of services or intermediary services.

Analysis: The petitions concerned refund of IGST paid on ship management services rendered under a longstanding agreement. The challenge was that the appellate authority had not examined the agreement in the context of the nature of the services actually provided, nor recorded a finding on whether the supplies satisfied the conditions of export of services and therefore qualified as zero-rated supplies. In the absence of such findings, and in view of the similar approach adopted in earlier cases involving comparable service agreements, the impugned orders could not be sustained.

Conclusion: The refund rejection orders were quashed and the matters were remanded to the appellate authority for de novo consideration and fresh orders in accordance with law after hearing the parties.

Ratio Decidendi: A refund rejection under the GST regime cannot stand where the appellate authority fails to examine the governing agreement and record findings on whether the transaction is an export of services or an intermediary service; such failure justifies quashing of the order and remand for fresh adjudication.

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