Hybon Technologies Private Limited Vs Special Commissioner (Delhi High Court)
The Delhi High Court has decided to proceed with a writ petition filed by Hybon Technologies Private Limited, rejecting a preliminary objection from the tax authorities. The authorities had argued that the petitioner should have used the alternative statutory remedy of an appeal to challenge the rejection of its refund claim.
The petitioner, however, raised a fundamental legal question, arguing that the tax authorities exceeded their jurisdiction by examining the admissibility of its Input Tax Credit (ITC) claims while processing the refund. The petitioner’s counsel contended that this action was beyond the scope of the powers granted under Section 16 of the Integrated Goods & Services Tax Act, 2017, and Section 54 of the Central Goods & Services Tax Act, 2017.
The court found that this jurisdictional challenge “strikes at the very foundation of the orders impugned” and merited further consideration. Consequently, it overruled the preliminary objection and directed the respondents to file a counter-affidavit within three weeks. The case, along with a related petition, will now be heard on its merits. The order indicates that the court considers the issue of the tax authority’s power over ITC claims during a refund process to be a substantial question of law.
