Nitrex Chemicals India Ltd Vs Assistant Commissioner Goods And Service Tax (Gujarat High Court)
The Gujarat High Court has dismissed a petition filed by Nitrex Chemicals India Ltd, upholding the tax authorities’ decision to reject a significant portion of its compensation cess refund claim on exported goods due to being time-barred. The ruling reinforces the strict interpretation of the two-year limitation period stipulated under Section 54 of the Central/State Goods and Service Tax (GST) Act, 2017.
Nitrex Chemicals, an exporter of Nitrocellulose, sought a refund of compensation cess that had gone into as input to its exported goods for the Financial Year 2017-2018. The company contended that it was entitled to this refund for Integrated Goods and Service Tax (IGST) paid on zero-rated supplies (exports) as per Section 54 of the GST Act read with Section 16 of the Integrated Goods and Service Tax Act, 2017 (IGST Act), which came into force from July 1, 2017.
The dispute arose when Nitrex Chemicals filed its refund application on June 15, 2020, for the period spanning July 2017 to March 2018. The Assistant Commissioner of Goods and Service Tax rejected the refund for most of this period, arguing that the application was filed beyond the “relevant period” as defined by Explanation (2) to Section 54 of the GST Act.
