GST-Refund-RFD-03 and RFD-08

[MANOHAR KALBURGI]

Dear sir/madam,

We have filed refund application on 30th June, 2021 for FIRC dated 14th April, 2019. The application filed as per extended due date, i.e., due date for such period was extended to 30th June, 2021.

In response to this application, we have received RFD-03(Deficiency Memo) on 6th July, 2021 and in response to RFD-03 a fresh application for refund filed by the Assessee on 12th July, 2021

Later officer has issued the RFD-08 (rejection of refund application) on 2nd Aug, 2021.

Now relevant date i.e., for two years counting shall be reckoned from 30th June or from 12 Aug (i.e fresh application in response deficiency)

The officer has argued that as per para 12 of Circular No. 125/44/2019 even fresh application should be filed before 2 years (i.e application fled response to RFD-03)

Please give your opinion on this issue, any citation/s available on this issue can be quoted.

Thank You in advance.

[KASTURI SETHI]

SH.MANOHAR KALBURGI JI,

The Board's circulars are binding on the department and not on the assessee. There is a case law of Supreme Court to this effect. Hence the department is correct.

However, you will get relief through litigation only. In my view, once a refund claim is filed within prescribed period, it cannot be treated as time barred notwithstanding Board's circular. Board's circulars are devoid of a statutory force.

There is possibility of case law on this issue but pertaining to the period prior to 30.6.17.

[Shilpi Jain]

1. There was a recent amendment in the refund provisions which can be handy - Exclusion of the period between the date of filing of refund application to the date of issuance of deficiency memo from the limitation period of 2 years

 

[KASTURI SETHI]

The date of effectiveness of Notification No.15/21-CT dated 18.5.21 ( vide which proviso to Rule 90(3) has been inserted has not published so far.

AI Summary

Limitation period for GST refund claims excludes time between filing and deficiency memo, affecting rejection timing.
The two year limitation for GST refund claims is contested where an initial application was followed by a deficiency memo and a fresh filing; the key operative point is that an amendment expressly excludes the period between filing and issuance of a deficiency memo from the two year limitation, while departmental circulars requiring fresh filing are administratively binding on the department but not on taxpayers, so taxpayers may need to seek judicial relief to challenge rejection grounded solely on such circulars.