TaxTMI 
TaxTMI 
2021 (12) TMI 1328
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....leased to direct the respondent authorities to pay interest @ 18% to the petitioner herein on the amount of refund of IGST mentioned hereinabove from the date of shipping bill mentioned in para 5.5 of this petition up till the date on which the amount of refund is paid to the petitioner herein, as the same is arbitrarily and illegally withheld by the respondent authorities. (E) Your Lordships may be pleased to grant an ex parte ad interim order in favour of the petitioner herein in terms of prayers clause "C" and "D" hereinabove." 2. The principal grievance raised by the petitioners is the inaction of the respondent Authorities regarding refund of IGST towards three Shipping Bills dated 28.07.2017, 02.08.2017 and 07.08.2017. 3. The petitioners are engaged in trading and export of Organic Soya Bean Feed Grade and they hold valid GST Registration No.23ADCPA0509R1ZU. It is the case of the petitioners that they had exported goods (Organic Soya Bean Feed Grade) under various invoices for which they had paid IGST of an amount of Rs. 12,00,800/-. The petitioners have referred to and relied upon form GSTR-1 and GSTR-3B, which they claimed to have filed within prescribed time....
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....8.2019, 18.11.2019, 03.02.2020, 19.02.2020, 26.02.2020, 02.03.2020, 05.03.2020, 22.07.2020 and 24.07.2020, however, no response has been given by the respondent authorities. 4. Learned Counsel Mr. D.K. Trivedi, appearing for the petitioner has mainly contended that the petitioner had exported goods and effected "Zero Rated Supply" under Section 16 of the IGST Act on the finished goods of three invoices, in regard of which IGST has not been sanctioned, which are quoted in tabular format as under: Sr. No. GST Invoice No. & Date Export Invoice No & Date Shipping Bill No. & Date Export General Manifest No. & Date Bill of Lading No & Date 01. SYB017/2017/18 28-Jul-17 7669998 28.07.17 131675-2017-11-1 MSCUUD589844 02. SYB018/2017/18 01-Aug-17 7767562 02.08.17 32568-2017-11-01 MSCUUD619815 03 SYB019/2017/18 05-Aug-17 7867436 07.08.17 131484-2017-11-1 MSCUUD683373 5. It is further contended by the learned advocate for the petitioner that the goods supplied by the registered person were neither NIL rated goods or exempt supplies. The said supplies are affected by the payment of IGST in accordance with th....
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....nt. It was further submitted by the petitioner that the inaction of the respondent authorities is causing serious monetary loss to the petitioner by not refunding such tax in accordance with the provisions of Section 54 of the CGST Act, 2017, more particularly, when the Superintendent of Customs (Export), Customs House, Mundra vide letter F.No. VIII/48-865/EXP/AMD/MP&SEZ/17-18 dated 22.09.2017, has confirmed the approval of amendment in shipping bills in terms of Section 149 of the Customs Act, 1962. The Learned Advocate Mr. Trivedi has further referred to and relied upon the decision rendered by this Court in the case of Amit Cotton (supra) and has urged to direct the respondent authorities to forthwith release the refund of IGST, with interest. Learned advocate for the petitioners has pressed into service, the decision of this Court in the case of Shri Jagdamba Polymers Ltd. Vs. Union India reported in 2013(289) E.L.T. 429 (Guj.) as well as the decision in the case of Purnima Advertising Agency Pvt. Ltd. Vs. Union of India reported in 2016(42) S.T.R. 785 (Guj.) and has submitted that the petitioner should be compensated for the prejudice caused due to inordinate delay because of ....
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....ed Counsel fairly accepted that no stay has been granted by the Hon'ble Apex Court in the pending SLP. 9. Heard learned advocates for the petitioner as well as respondents. 10. On perusal of the record of the case, it appears that the petitioners have exported goods in the month of July-August, 2017 from Mundra Port. The petitioners hold valid GST registration No. 23ADCPA0509R1ZU. and is governed by the provisions of the CGST as well as IGST Rules, 2017. Before adverting to the issue involved, it would be appropriate to have glance at the relevant provisions of Sections 16 of IGST Act, 2017, Section 54 of the CGST Act and Rule 96 of CGST Rules, 2017 are reproduced below: "16. Zero rated supply.- (1) "zero rated supply" means any of the following supplies of goods or services or both, namely:-- (a) export of goods or services or both; or (b) supply of goods or services or both to a Special Economic Zone developer or a Special Economic Zone unit. (2) Subject to the provisions of sub-section (5) of section 17 of the Central Goods and Services Tax Act, credit of input tax may be availed for making zero-rated supplies, notwithstanding t....
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.... exempt supplies), except supplies of goods or services or both as may be notified by the Government on the recommendations of the Council: Provided further that no refund of unutilised input tax credit shall be allowed in cases where the goods exported out of India are subjected to export duty: Provided also that no refund of input tax credit shall be allowed, if the supplier of goods or services or both avails of drawback in respect of central tax or claims refund of the integrated tax paid on such supplies. (4) The application shall be accompanied by- (a) such documentary evidence as may be prescribed to establish that a refund is due to the applicant; and (b) such documentary or other evidence (including the documents referred to in section 33) as the applicant may furnish to establish that the amount of tax and interest, if any, paid on such tax or any other amount paid in relation to which such refund is claimed was collected from, or paid by, him and the incidence of such tax and interest had not been passed on to any other person: Provided that where the amount claimed as refund is less than two lakh rupees, it shall not....
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....notification, specify. (9) Notwithstanding anything to the contrary contained in any judgment, decree, order or direction of the Appellate Tribunal or any court or in any other provisions of this Act or the rules made thereunder or in any other law for the time being in force, no refund shall be made except in accordance with the provisions of sub-section (8). (10) Where any refund is due under sub-section (3) to a registered person who has defaulted in furnishing any return or who is required to pay any tax, interest or penalty, which has not been stayed by any court, Tribunal or Appellate Authority by the specified date, the proper officer may- (a) withhold payment of refund due until the said person has furnished the return or paid the tax, interest or penalty, as the case may be; (b) deduct from the refund due, any tax, interest, penalty, fee or any other amount which the taxable person is liable to pay but which remains unpaid under this Act or under the existing law. Explanation.--For the purposes of this sub-section, expression "specified date" shall mean the last date for filing an appeal under this Act. (11) Where an or....
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....to a place outside India; (b) in the case of supply of goods regarded as deemed exports where a refund of tax paid is available in respect of the goods, the date on which the return relating to such deemed exports is furnished; (c) in the case of services exported out of India where a refund of tax paid is available in respect of services themselves or, as the case may be, the inputs or input services used in such services, the date of-- (i) receipt of payment in convertible foreign exchange, where the supply of services had been completed prior to the receipt of such payment; or (ii) issue of invoice, where payment for the services had been received in advance prior to the date of issue of the invoice; (d) in case where the tax becomes refundable as a consequence of judgment, decree, order or direction of the Appellate Authority, Appellate Tribunal or any court, the date of communication of such judgment, decree, order or direction; (e) in the case of refund of unutilised input tax credit under sub-section (3), the end of the financial year in which such claim for refund arises; (f) in the case where tax is paid provis....
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....ed to the bank account of the applicant mentioned in his registration particulars and as intimated to the Customs authorities. (4) The claim for refund shall be withheld where,- (a) a request has been received from the jurisdictional Commissioner of central tax, State tax or Union territory tax to withhold the payment of refund due to the person claiming refund in accordance with the provisions of sub-section (10) or sub-section (11) of section 54; or (b) the proper officer of Customs determines that the goods were exported in violation of the provisions of the Customs Act, 1962. (5) Where refund is withheld in accordance with the provisions of clause (a) of sub-rule (4), the proper officer of integrated tax at the Customs station shall intimate the applicant and the jurisdictional Commissioner of central tax, State tax or Union territory tax, as the case may be, and a copy of such intimation shall be transmitted to the common portal. (6) Upon transmission of the intimation under sub-rule (5), the proper officer of central tax or State tax or Union territory tax, as the case may be, shall pass an order in Part B of FORM GST RFD-07. ....
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....rating. It is not in dispute that the goods in question are one of "Zero Rated supplies". A registered person making "Zero Rated Supplies" becomes eligible to claim refund under the options as provided in sub-clauses (a) and (b) to clause (3) of Section 16 referred to above. Section 54 of the IGST Act, 2017 provides that any person claiming refund of any tax and interest, if any, paid on such tax or any other amount paid by him shall make an application before the expiry of two years from the relevant date in such form and manner as may be prescribed. 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 and the amount so determined will have to be credited to the fund referred to in Section 57 of the CGST Act, 2017. So far as Rule 96 of the CGST Rules, 2017 is concerned, the same raises a deeming fiction inasmuch as the shipping bills, which are submitted by the exporter of the goods are deemed to be treated as an application for refund of the integrated tax paid on such goods so exported out of India. On bare reading of Section 54 referred to above along with R....
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....availed higher duty drawback and as there is no provision for accepting the refund of such higher duty drawback, the writ-applicant is not entitled to seek the refund of the IGST paid in connection with the goods exported, i.e. 'zero rated supplies'. 28. If the claim of the writ-applicant is to be rejected only on the basis of the circular issued by the Government of India dated 9th October 2018 referred to above, then we are afraid the submission canvassed on behalf of the respondents should fail as the same is not sustainable in law. 29. We are not impressed by the stance of the respondents that although the writ-applicant might have returned the differential drawback amount, yet as there is no option available in the system to consider the claim, the writapplicant is not entitled to the refund of the IGST. First, the circular upon which reliance has been placed, in our opinion, cannot be said to have any legal force. The circular cannot run contrary to the statutory rules, more particularly, Rule 96 referred to above. 30. Rule 96 is relevant for two purposes. The shipping bill that the exporter may file is deemed to be an application for refund....
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.... are concerned they represent merely their understanding of the statutory provisions. They are not binding upon the Court. It is for the Court to declare what the particular provision of statute says and it is not for the executive. Looked at from another angle, a circular which is contrary to the statutory provisions has really no existence in law." Again, in the case of J.K.Lakshmi Cement Limited v. Commercial Tax Officer, Pali, reported in 2018(14) G.S.T.L. 497 (S.C.) wherein the Hon'ble Supreme Court has observed at para 25, which reads as under: "The understanding by the assessee and the Revenue, in the obtaining factual matrix, has its own limitation. It is because the principle of res judicata would have no application in spite of the understanding by the assessee and the Revenue, for the circular dated 15.04.1994, is not to the specific effect as suggested and, further notification dated 07.03.1994 was valid between 1st April, 1994 up to 31st March, 1997 (upto 31st March, 1997 vide notification dated 12.03.1997) and not thereafter.The Commercial Tax Department, by a circular, could have extended the benefit under a notification and, therefore, principle of estop....
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.... not allowing the refund of IGST for those exporters, who claim higher duty drawback is that the higher duty drawback reflects the elements of Customs, Central Excise and Service Tax taken together and since higher duty drawback is already being availed than granting the IGST refund would amount to double benefit as the Central Excise and Service Tax has been subsumed in the GST. In the case of the writ applicant, the drawback rates being the same, it represents only the Customs elements, which did not get subsumed in the GST and thus, the writ applicant cannot be said to have availed double benefit i.e. of the IGST refund and higher duty drawback. 11. In the result, this petition succeeds and is hereby allowed. The respondents are directed to immediately sanction the refund towards the IGST paid in respect to the goods exported i.e.'Zero Rated Supplies' made vide the shipping bills. It appears that the writ applicant has also prayed to pay interest at the rate of 9% on the amount of refund from the date of shipping bill till the date on which the amount is actually paid. We may only say that if the refund of the principal amount is not sanctioned and actually paid....
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....y the Government on the recommendations of the Council shall be payable in respect of such refund from the date immediately after the expiry of sixty days from the date of receipt of application till the date of refund. Explanation: For the purposes of this section, where any order of refund is made by an Appellate Authority, Appellate Tribunal or any court against an order of the proper officer under sub-section (5) of section 54, the order passed by the Appellate Authority, Appellate Tribunal or by the court shall be deemed to be an order passed under the said sub-section (5)." On bare perusal of the aforesaid Section, it is explicitly made clear that if the applicant is not refunded the tax amount within 60 days from the date of receipt of the application under Sub-Section 1 of Section 54 then interest at such rate not exceeding 6% as may be specified in the Notification, which may be issued by the Government is payable in respect of such refund from the date immediately after expiry of 60 days from the date of receipt of such application till refund amount is received. The records reveals that the petitioners have raised the refund of IGST immediately within prescribed time ....