Case Law Details
Vodafone Idea Limited Vs Union of India & Others (Bombay High Court)
Bombay High Court ruled in favor of Vodafone Idea Limited, setting aside four orders passed by the Additional Commissioner (Appeals)-II, CGST & Central Excise, Mumbai. The company had challenged these orders and also raised concerns about the GSTN portal, which does not allow a second refund claim for the same period and category. The petitioner argued that the impugned orders contradicted previous final orders issued by the Joint Commissioner (Appeals-II) and the adjudicating authority, which had ruled favorably on similar issues. The dispute centered on three key issues: the lack of correlation between invoices and foreign currency receipts, the validity of bank statements showing netting-off as proof of payment in foreign exchange, and the timing of foreign currency receipts in relation to the refund period. The court heard submissions from both sides, including the government’s counsel, who agreed that the case should be remanded for fresh adjudication.
The High Court directed that the previous orders be set aside and that the Additional Commissioner (Appeals)-II reconsider the appeals in accordance with judicial principles and natural justice within two months. Furthermore, it addressed Vodafone Idea’s concern regarding the GSTN portal’s technical limitations, allowing them to refile their refund claims under the category “Others” if the portal did not permit claims under “Export of Services.” The petition was thus disposed of while keeping the broader issue of GSTN portal functionality open for future consideration. The court issued no order on costs and instructed that a digitally signed copy of the order be acted upon by all concerned parties.
FULL TEXT OF THE JUDGMENT/ORDER OF BOMBAY HIGH COURT
1. The Petitioners have challenged four orders passed by the 5th Respondent (Additional Commissioner [Appeals]-II) CGST & Central Excise, Mumbai dated 18th March, 2024 (Exhibit J1), 29th February, 2024 (Exhibit J2), 29th February, 2024 (Exhibit J3) and 1st March 2024 (Exhibit J4). The Petitioners have also made the Goods and Service Tax Network (GSTN) party Respondent and have challenged the portal designed by the GSTN as being defective inasmuch as it does not permit a 2nd refund claim for the same period and under the same category.
2. Mr. Shroff, the learned Senior Advocate appearing for the Petitioner submits that the impugned orders are contrary to earlier orders passed by the Appellate Authority itself, i.e., Joint Commissioner (Appeals – II) CGST & Central Excise, Mumbai dated 18th August 2021/ 14th September 2021 (Exhibit L) and 2nd January 2023 passed by the Joint Commissioner (Appeals- II), CGST & Central Excise, Mumbai, which have now become final. It is the Petitioners case that even the adjudicating authority has passed favourable orders dated 16th July 2021 (Exhibit K), 14th October 2022 (Exhibit N) and 5 orders all dated 8th March 2023 (Exhibit P1-P5) all of which have become final. These final orders of the Joint Commissioner (Appeals-II) and the favourable orders of the adjudicating authority squarely covers all the 3 issues involved in the impugned orders, namely:
(i) that there was no co-relation of the invoices and the amount of foreign currency received, i.e., no e-BRC had been filed;
(ii) that the bank statement showing netting off as payment received in convertible foreign exchange appears not a valid proof; and
(iii) the date of payment received in foreign currency is not within the refund period.
3. Mr. Mishra, the learned Counsel appearing on behalf of the Respondents on instructions states that the orders of the 5th Respondent can be set aside and remanded back to the 5th Respondent for adjudication of the 4 Appeals by following the principles of natural justice.
4. Shroff, the learned Senior Advocate appearing for the Petitioner submits that as per the GST provisions, if the 5th Respondent allows the appeals, the Petitioners would have to file refund claims once again. They, however, apprehend that the GSTN portal would not permit them to do so.
5. After hearing the parties, we direct that the orders of the 5th Respondent referred to in paragraph 1 above, are hereby set aside and the 5th Respondent is directed to pass appropriate orders in accordance with law following the principle of judicial discipline, within a period of 2 months from the date of receipt of this order and after following the principles of natural justice.
6. If the GSTN portal does not permit the filing of refund claims under the category “Export of Services”, then the Petitioners are permitted to file the refund claims under the category “Others” on the portal.
7. The Petition is disposed of in the above terms and the issue relating to the challenge to the GSTN portal is kept open. No order as to costs.
8. This order will be digitally signed by the Private Secretary/ Personal Assistant of this Court. All concerned will act on production by fax or email of a digitally signed copy of this order.
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