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2021 (12) TMI 1040

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....rder will dispose of both W.P.Nos.527 and 616 of 2020. 2. Heard Mr. T.Sruyanarayana, learned counsel for the petitioner and Mr.L.Venkateshwar Rao, learned counsel representing Mr.K.Raji Reddy, learned Senior Standing Counsel for the Commercial Tax Department. 3. Issue relates to rejection of claim of refund of the petitioner. 4. Petitioner is engaged in the business of exporting software and information technology services. In connection with the export business of the petitioner, input tax paid on input services and capital goods gets accumulated as unutilized credit in the books of account of the petitioner. As a result, petitioner has been filing refund claims for refund of utilized input tax credit under Section 54(3) of the Telangan....

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.....01.2020 respectively, respondent has not filed counter affidavit. 8. Section 54 of the CGST Act deals with refund of tax. Sub-section (1) says that any person claiming refund of any tax and interest may make an application before the expiry of two years from the relevant date in the prescribed form and manner. As per sub-section (5), if on receipt of any such application, the proper officer is satisfied that the whole or part of the amount claimed as refund is refundable, he may make an order accordingly. In terms of sub-section (7), the proper officer shall issue the order under sub-section (5) within 60 days from the date of receipt of the application, complete in all respects. 9. Chapter X of the CGST Rules deals with refund. Rule 89 ....

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....of notice and after considering the reply make an order sanctioning the amount of refund in whole or in part or rejecting the refund claim which order shall be made available to the applicant. As per the proviso, an application for refund shall not be rejected without giving the applicant an opportunity of being heard. Therefore, there is a clear legal mandate that if an application for refund is to be rejected, the same can only be done after giving the applicant an opportunity of being heard. 11. The expression 'opportunity of being heard' is not an expression of empty formality. It is a part of the well-recognized principle of audi alteram partem which forms the fulcrum of natural justice and is central to fair procedure. The pr....