Recovery of demand through adjustment with refund claim when the appeal period of said demand not yet over.

[Shashi Thakur]

Please let us know whether the Department as per GST Act can recover the confirm demand either in the form of adjustment with assessee’s refund claim or any other way, when the period to appeal against the said demand is yet to expire.

If no, how the demand being reflected in the GST Portal be “by-passed/ ignored” to sanction the full refund

AI Summary

Refund adjustment under GST: authorities may withhold or deduct refunds to meet unpaid tax before the appeal period ends.
The statute permits withholding or deducting a refund where the registered person remains liable for tax, interest or penalty not stayed by an appellate authority by the specified date, defined as the last date for filing an appeal; the proper officer may withhold refund payment until compliance or deduct unpaid liabilities from the refund, creating a practical conflict with portal processes and differing practitioner views on whether recovery should await expiry of the appeal period.