2023 (2) TMI 536

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....espondent rejecting the claim of the petitioner of payment of interest from the date of encashment of bank guarantees i.e., 29.03.2019 till grant of refund on 05.01.2022 in terms of the order passed by the Bombay High Court in W.P.No.6968/2019 and for other reliefs. 2. Heard learned counsel for the petitioner and learned counsel for the respondents and perused the material on record. 3. In addition to reiterating the various contentions urged in the petition and referring to the material on record, learned counsel for the petitioner submits that during the period from 17.10.2018 to 26.10.2018, petitioner furnished 8 Bank Guarantees in a sum of Rs.4,73,26,512/- by way of security for release of goods and subsequently, aggrieved by the ....

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....r to file a refund application in terms of Section 54 of the CGST Act and Rule 89 of the CGST Rules. The petitioner submitted a reply dated 06.11.2021 enclosing the refund application. However, the petitioner specifically stated that the refund applications dated 24.11.2021, 30.12.2021 and 30.12.2021 had been filed only at the instance/insistence of the authorities and were without prejudice to its rights to seek interest on the amount covered under the Bank guarantees. 3.3 Subsequently, on 05.01.2022, the 3rd respondent granted refund to the petitioner in a sum of Rs.4,73,26,512/- in terms of the Bombay High Court judgment, but rejected the interest claimed by the petitioner, as a result of which, petitioner filed one more application d....

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.... statement of objections, submit that there is no merit in the petition and the same is liable to be dismissed. 5. I have given my anxious consideration to the rival submissions and perused the material on record. 6. The material on record discloses that undisputedly, the respondents encashed the bank guarantees of the petitioner on 23.09.2019 and the same was retained and was lying with them from that date onwards up to 05.01.2022 when the said sum of Rs.4,73,26,512/- was refunded back to the petitioner. In this context, a perusal of the judgment of the Bombay High Court will indicate that the respondents were directed to refund the said amount together with applicable statutory interest thereon, within a period of four weeks. A plai....

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....der, the Bombay High Court has expressly referred to statutory provisions relating to filing of appeals, payment of interest etc., including referring to Sections 54, 56 and 115 of the GST Act. It is therefore clear that the Bombay High Court was of the definite opinion that the petitioner was not only entitled to refund of the aforesaid amount of Rs.4,73,26,512/- covered by the 8 encashed bank guarantees but that the petitioner would also be entitled to interest thereon as can be discerned from the judgment of the Bombay High Court and consequently, the said finding recorded in the impugned order deserves to be set aside. 9. A perusal of the judgment of the Bombay High Court will also indicate that directions were issued to the responde....

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....n the aforesaid judgments, even in the absence of any statutory provision, in the light of the undisputed fact that the respondents illegally retained and withheld the amounts legally belonging to the petitioner during the period from 29.03.2019 when the bank guarantees were encashed up to 05.01.2022 when the amounts covered thereunder were refunded back to the petitioner, even in the absence of any statutory provision, the petitioner would be entitled to interest at a reasonable rate on the said amount for the aforesaid period and viewed from this angle also, the impugned order is unsustainable and deserves to be set aside. 11. The undisputed material on record discloses that the petitioner has been wrongly and without any fault on its ....