Case Law Details
Messers Filatex India Ltd. Vs Union of India (Gujarat High Court)
The short point for our consideration as on date is whether the assertion on the part of the writ applicant that it is entitled to claim the refund in accordance with the formula as provided under Sub Rule (4) of Rule 89 of the Rules is correct? To put it in other words, whether it is Sub Rule (4B) of Rule 89 which should be made applicable for the purpose of determining the claim so far as the refund is concerned?
Mr. Dave vehemently submitted that in fact, if there is any formula which could be said to have been provided for the purpose of adjudicating the claim, the same is to be found in Sub Rule (4) of Rule 89, as Sub Rule (4B) of Rule 89 does not provide for any formula. However, Mr. Dave invited the attention of this Court to the stance of the Commissioner, as reflected in the affidavit-in-reply filed on behalf of the respondents. We take notice of the fact that Shri Manoj Kumar Srivastava, Principal Commissioner of Central Goods and Service Tax and Central Excise, Vadodara – II has affirmed the reply.
Also Read:GST Refunds under Rule 89(4) Vis-À-Vis Rule 89(4A)/(4B) –An Analysis
The stance of the Principal Commissioner is that it is not correct on the part of the writ applicants to say that if Sub Rule (4B) of Rule 89 is to be applied, then it is difficult for the writ applicants to establish the quantum of ITC availed in respect of inputs or input services to the extent used in exporting the goods. According to Mr. Dave, the Principal Commissioner, in its reply, has himself provided a workable formula. In such circumstances, according to Mr. Dave, there need not be any debate now whether the Sub Rule (4) or Sub Rule (4B) of Rule 89 would apply. In the reply, the Principal Commissioner has stated that each and every manufacturer / exporter is believed to be aware of the input / output ratio of the inputs / raw materials used in such manufacturing of the exported goods and the ITC availed against such input supplies received. According to the Principal Commissioner, it is difficult to believe that the manufacturer would not be aware, otherwise the manufacturer would not be in a position to arrive at the costing of the finished goods.
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With all due regards to Hon’ble High Court, is really one-to-one corelation of input to output is contemplated under GST Law? Even otherwise, how it is applicable to input services?
What is the significance of sub-rules (4A) and (4B) when sub-rule (4) is in place? Does it mean that prior to insertion of (4A) and (4B), the refunds were incorrectly sanctioned where the benefits of the said notifications were availed? How can it be held that the option (c) in the common portal is meant for sub-rule (4), and not for (4A) or (4B)? Why should one apply in ‘any other’ category when category (c) is squarely applicable? Presuming that formula under (4) cannot be used for filing claim under (4A) or (4B), then why sub-rule (2) does not specify the documents for filing claims under these two sub-rules? These vital points have not been dealt with in the judgment, and hence, in all humility, the judgment suffers from infirmity.