Bombay HC GST Quashed Refund Rejection for Ex Parte Order Without Hearing

Knowledge Capital Services Pvt. Ltd. Vs Union of India & Ors. (Bombay High Court)

The petition was filed under Article 226 of the Constitution challenging an order dated 25 July 2022 passed by the Assistant Commissioner of State Tax, whereby the petitioner’s application for refund under Section 16 of the Integrated Goods and Services Tax Act, 2017 read with Section 54 of the Central Goods and Services Tax Act, 2017 was rejected. The refund pertained to the period from April 2019 to March 2020. The primary grievance raised by the petitioner was that the impugned order was passed ex parte without granting an opportunity of hearing, thereby violating procedural requirements.

The petitioner submitted that a similar issue had previously arisen in its own case before the High Court, where an identical order had been set aside. In that earlier decision, the Court had directed restoration of the refund application for fresh consideration, with instructions that any deficiencies be communicated to the petitioner in the prescribed format and the application be processed in accordance with law. It was argued that the present case was identical and warranted similar relief.

The respondents relied on their reply affidavit to justify the impugned order. However, it was not disputed that no opportunity of hearing had been provided and that the order had been passed ex parte without following due procedure.