Haren Textiles Private Limited Vs Deputy Commissioner of State Tax (Bombay High Court)
In Haren Textiles Private Limited vs Deputy Commissioner of State Tax, the Bombay High Court examined a challenge to refund orders where certain refund claims were rejected. The petitioner had applied for refunds, some of which were granted while others were denied through impugned orders.
The petitioner’s primary grievance was non-compliance with Rule 92(3) of the CGST Rules, 2017. This provision requires that where a refund claim is proposed to be rejected, the proper officer must issue a notice in Form GST RFD-08, invite a reply in Form GST RFD-09, and then pass a reasoned order after considering the reply. The proviso further mandates that no refund application shall be rejected without granting a reasonable opportunity of being heard.
The respondents contended that a hearing had been granted to the petitioner’s representative. However, the Court found that such compliance was not substantiated. It observed that Rule 92(3) specifically requires issuance of a show cause notice and consideration of the applicant’s reply before passing any order rejecting refund, along with providing an opportunity of hearing.
In view of this procedural requirement, the Court held that the impugned orders rejecting refund did not comply with Rule 92(3). Accordingly, it set aside the orders to the extent they denied refund and directed the authorities to reconsider the matter afresh in accordance with law and after following the prescribed procedure.
