Gupta Battery House Limited Vs State of Telangana (Telangana High Court)
Recovery of sanctioned GST refund under Section 73/74 without challenging refund order questioned: Telangana HC
The Telangana High Court considered a challenge to an order-in-appeal dated 09.04.2026 affirming an order-in-original dated 05.05.2025 directing recovery of a GST refund of Rs. 3,92,50,762 along with penalty under Section 73 of the Central Goods and Services Tax Act, 2017, despite a Refund Sanction Order dated 05.09.2023 against which the Revenue had not preferred any appeal. The petitioner contended that reopening concluded refund proceedings by the same authority on a mere change of opinion was impermissible, that recovery of a sanctioned refund without challenging the Refund Sanction Order was without jurisdiction, and that no powers under Sections 107(1) or 108 of the CGST Act had been invoked to annul the refund. The respondents were granted three weeks’ time to obtain instructions and file a counter affidavit. The High Court directed that the matter be listed after three weeks and, in the meantime, granted an interim stay of the impugned order-in-appeal.
Argued by Adv. Bharat Raichandani i/b UBR Legal.
FULL TEXT OF THE JUDGMENT/ORDER OF TELANGANA HIGH COURT
Mr. Bharath Raichandani, learned counsel representing Mr. Md. Nazeeruddin Khan, learned counsel, appears for the petitioner through video conference.
Mr. Swaroop Oorilla, learned Special Government Pleader for State Tax appears for the respondents.
The impugned order-in-appeal dated 09.04.2026 has affirmed the order-in-original dated 05.05.2025 directing recovery of the refund of Rs.3,92,50,762/- along with penalty under Section 73 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as ‘the CGST Act’) despite a Refund Sanction Order dated 05.09.2023 against which no appeal has been preferred by the Revenue.
Learned counsel for the petitioner has taken the ground that reopening of concluded refund proceedings by the very same authority on a mere change of opinion is not permissible. Recovery of sanctioned refund without challenging the Refund Sanction Order is without jurisdiction. No power under Section 107(1) or Section 108 of the CGST Act has been invoked to annul the refund sanctioned in favour of the petitioner.
Apart from that, further grounds have also been taken.
Learned Special Government Pleader for State Tax is allowed three weeks’ time to obtain instructions and file counter affidavit.
List the matter after three weeks.
In the meantime, there shall be interim stay of the impugned order-in-appeal dated 09.04.2026.
