Commissioner of Central Goods And Services Tax Vs Abhishek Ramisetty (Calcutta High Court)
Calcutta High Court has dismissed an appeal filed by the Commissioner of Central Goods and Services Tax, affirming a Single Bench’s directive for the tax department to clearly communicate deficiencies in GST refund applications. The ruling emphasizes the principles of natural justice and statutory mandate in processing refund claims.
The case originated from a writ petition filed by Abhishek Ramisetty, seeking a directive for the tax department to process and refund amounts claimed under Section 54 of the CGST Act, along with interest. The Single Bench had disposed of the writ petition by instructing the department to address and rectify the deficiencies it had pointed out in Form GST RFD-03 and process the application within a specified timeframe.
The revenue department subsequently filed an intra-court appeal, which itself was delayed by 91 days. The Division Bench, while acknowledging the department’s lack of diligence in filing the appeal within the limitation period—a standard it expects from assessees—exercised its discretion to condone the delay, noting that it had heard the department’s counsel extensively.
The core of the dispute revolved around three refund applications filed by Ramisetty in Form GST RFD-01 for the periods April 2020 to March 2021, April 2021 to March 2022, and April 2022 to March 2023, submitted in May 2023. The department uploaded deficiency memos in Form GST RFD-03, broadly selecting the option “supporting documents attached are incomplete.”
However, the writ petitioner contended that no specific details of the purported deficiencies were uploaded on the common portal. Screenshots were submitted to the court to support the claim that the department failed to communicate specific reasons for deeming the applications defective. This lack of specific communication prevented the assessee from understanding and rectifying the alleged flaws in their refund claims.
During the writ petition’s hearing, the department’s standing counsel eventually presented the specific deficiencies to the Single Bench, citing provisions such as the second proviso to Section 54(3) and Section 54(3)(ii) of the CGST Act, and Rule 89(5) and Rule 89(2)(h) of the CGST Rules, 2017. This revelation confirmed that the assessee was not privy to these details through the official portal communication, where the deficiency column merely stated “supporting documents attached are incomplete.”
The Division Bench affirmed that it was “not in dispute that the assessee was not made known of the defects which they are required to rectify.” The court emphasized that such communication is not only a requirement for adhering to the principles of natural justice but also a statutory mandate under sub-rule (3) of Rule 9 of the CGST Rules. This rule obliges the proper officer to communicate any deficiencies to the applicant in Form GST RFD-03 through the common portal electronically, requiring the filing of a fresh refund application after rectification. Without such specific communication, the assessee is effectively prevented from rectifying errors and submitting a corrected application.
The High Court found the Single Bench’s decision to permit the writ petitioner to cure the deficiencies and resubmit the refund application to be “just and proper and calls for no interference.” It noted that the deficiencies pointed out by the department were “not substantive in nature but more procedural,” further justifying the opportunity for rectification.
While upholding the essence of the Single Bench’s order, the Division Bench made a minor modification. Recognizing that the statute mandates a fresh refund application after rectification of deficiencies, the court directed Ramisetty to rectify all deficiencies identified by the department (as recorded in the Single Bench’s order) and upload a fresh refund application within two weeks of receiving the court’s order. Critically, it added that if the common portal is unable to accept online filing, the writ petitioner would be permitted to file a manual application, which the department would then be obligated to process as per the Single Bench’s directions.
The appeal was dismissed without costs. The court explicitly clarified that this judgment should not be treated as a precedent, as it was passed considering the specific facts and circumstances of this particular case. This clarification suggests the court’s emphasis on equitable considerations in light of the department’s failure to provide clear deficiency communication, rather than establishing a broad legal precedent for all refund-related delays.
FULL TEXT OF THE JUDGMENT/ORDER OF CALCUTTA HIGH COURT
