AWL Agri Business Vs State of Odisha (Orissa High Court)
The petitioner challenged an Order-in-Original dated 11.12.2025 passed under Section 73 of the OGST/CGST Acts by the Deputy Commissioner of State Tax, Cuttack-I City Circle. The petitioner, engaged in manufacturing edible oils, accumulated input tax credit because its inputs attracted GST at 12% or 18%, whereas its output supplies were taxable at 5%. Refund applications filed under the inverted duty structure provisions of Section 54(3)(ii) were sanctioned through speaking orders under Section 54(5) read with Rule 92.
The petitioner contended that the authorities could not seek recovery of already sanctioned refunds through proceedings under Section 73 without first challenging the refund orders through the appellate mechanism under Section 107. Reliance was placed on CBIC Instruction No. 03/2022-GST dated 14.06.2022, which provides that refund orders should be reviewed to determine whether an appeal under Section 107 is required.
The Court noted that the adjudication order under Section 73 appeared to have been framed to nullify the effect of refund orders passed under Section 54, instead of questioning those orders in the prescribed manner. Observing that the petitioner had made out a prima facie case, the Court held that interim protection was warranted. Accordingly, the authorities were restrained from taking coercive action pursuant to the demand raised in the order dated 11.12.2025 for the tax periods from April 2021 to March 2022 until the next date of listing. The respondents were granted time to file a counter affidavit, and the matter was directed to be listed on 7 May 2026.
