Kunal International Vs Union of India & Ors (Delhi High Court)
The Delhi High Court, in the case of Kunal International v. Union of India & Ors., addressed a crucial issue regarding the disbursement of a Goods and Services Tax (GST) refund. The petitioner, Kunal International, sought a refund of input tax credit (ITC) for goods exported without tax payment during March 2020. The dispute arose after the tax authorities refused to disburse the refund, even though the petitioner had won their appeal at the Appellate Authority level. The court’s decision clarifies that a favorable order from the Appellate Authority must be complied with, regardless of the government’s intention to file a further appeal.
Factual Background and Legal Proceedings
Kunal International, a company engaged in exporting goods, had applied for a refund of ₹71,13,806 in ITC. The Adjudicating Authority, however, sanctioned only a partial refund of ₹9,23,957. The authority justified the rejection of the remaining amount by asserting that the petitioner had wrongly availed an ITC of ₹1,92,78,267. This initial decision led the petitioner to file an appeal under Section 107 of the Central Goods and Services Tax Act, 2017 (CGST Act).
The Appellate Authority ruled substantially in favor of Kunal International, directing the refund of ₹61,79,004.20 and setting aside the lower authority’s order. Despite this clear directive, the respondents (the Union of India and its tax departments) failed to disburse the sanctioned amount. Their refusal to pay prompted the petitioner to file a writ petition with the Delhi High Court.
