Case Law Details
Hlllifecare Ltd. Vs Assistant Commissioner of Central GST & Central Excise (Kerala High Court)
Introduction: In a recent verdict, the Kerala High Court addressed a case where a petitioner sought a refund of Input Tax Credit (ITC) that had been wrongly denied by the Deputy Commissioner of Central GST & Central Excise. This article provides a detailed analysis of the case, the court’s decision, and its implications.
Detailed Analysis
1. Background of the Case The petitioner had initially filed a refund application for Input Tax Credit (ITC) on 29th August 2020. However, this application was rejected by the Deputy Commissioner on 3rd November 2020, citing it as time-barred.
2. The Refund Application The petitioner had claimed a refund of the ITC, and the application was rejected by the Deputy Commissioner. This led to the filing of a writ petition to seek the court’s intervention.
3. Petitioner’s Claim The petitioner had previously reported the process based on which the Input Tax Credit on Input was availed during the relevant period for which the refund was claimed. Despite the petitioner’s rightful claim and the orders in their favor, the refund amount had not been credited.
4. Court’s Ruling The court acknowledged that the petitioner was entitled to receive the refunded amount. However, due to a system requirement, the refund could not be processed without a corresponding debit from the Electronic Credit Ledger.
5. Resolution of the Issue The court directed the petitioner to file GST Form DRC-03, an intimation for Voluntary Payment, for the refund amount. This step would allow the sanctioned refund amount to be transferred to the petitioner’s bank account.
Conclusion: The Kerala High Court’s decision in the case of Hlllifecare Ltd. Vs. Assistant Commissioner of Central GST & Central Excise highlights the importance of adhering to the system’s requirements for processing refunds. In this instance, the petitioner was rightfully granted a refund, but due to procedural constraints, the refund could not be credited. By directing the petitioner to file GST Form DRC-03, the court provided a solution to ensure the petitioner receives their legitimate Input Tax Credit refund. This case emphasizes the need for compliance with tax procedures to facilitate smooth and timely refunds for taxpayers.
FULL TEXT OF THE JUDGMENT/ORDER OF KERALA HIGH COURT
1. These writ petitions have been filed under Article 226 of the Constitution of India seeking following prayers:
a) To call for the records leading to Exhibit-P5 order and quash the same to the extent of rejecting the refund, by issuing a writ of certiorari.
b) To issue a writ of mandamus or any other writ order or direction, directing respondent to refund the amount found eligible in Ext.P5 order, by deducting/debiting the same in Ext.P6 along with applicable interest.
c) Pending hearing and final disposal of this writ petition, this Hon’ble Court may be pleased to direct the respondent to provisionally refund the amounts found eligible in Ext.P5 order.
d) Issue such other and further reliefs as this Hon’ble Court may deem fit and proper in the interest of justice.
2. The petitioner had originally filed an application dated 29.08.2020 for refund of the Input Tax Credit. Upon such application the requisite equal amount was automatically debited from the Electronic Credit Ledger. The said refund application was rejected by order dated 03.11.2020 in Ext.P1, by the Deputy Commissioner, CGST as being timed barred,.The present writ petitioners had reported the terms of the following process based on which the Input Tax Credit on Input has been availed during the relevant period for which refund was being claimed. The petitioner has filed for refund of Input Tax Credit as mentioned in Ext.P5 order. Despite the said orders, Ext.P5 the petitioner has not being refunded the said amount and for which these writ petitions have been filed.
3. Learned counsel for the petitioner submits that despite the petitioner had been informed is entitled to receive back the Input Tax Credit amount, the petitioner has not been refunded the amount for which the present writ petition has been filed. Learned counsel for the respondent submits that as per the system, since the debit from the Electronic Credit Ledger for the transfer to the petitioner’s bank account even if refund is sanctioned for want of debit in the Electronic Credit Ledger, the amount cannot be credited to the account of the petitioner. Learned counsel for the petitioner submits that in the circumstances, the petitioner is required to file GST Form DRC-03 under the head intimation for Voluntary Payment for the refund amount in order to fetch the transfer amount ordered to be refunded. Learned counsel for the petitioner submits that, the petitioner will file GST Form DRC-03 within a period of two weeks. If the petitioner files necessary GST Form DRC 03 for the sanctioned amount of the refund of the Input Tax Credit, the said amount shall be credited in the account of the petitioner.
4. With the aforesaid directions to the petitioner and respondents, these writ petitions stand finally disposed of.
