Delhi HC Orders Re-evaluation of Kesri Steels’ Refund Claim under DVAT

Kesri Steels Limited Vs Commissioner of Delhi Goods And Service Tax & Ors (Delhi High Court)

This article explores the recent Delhi High Court judgment in the case of Kesri Steels Limited vs Commissioner of Delhi Goods and Service Tax & Ors (W.P.(C) No. 7365/2022). The case highlights the importance of proper record-keeping and verification processes in resolving disputes related to Goods and Service Tax (GST) refunds.

Background:

Kesri Steels Limited, the petitioner, filed a petition challenging two orders related to a GST refund claim:

• Order dated November 27, 2011: This order framed a default assessment of tax and interest, ultimately finding no tax liability for the petitioner.
• Order dated February 24, 2022: This order, passed by the Additional Commissioner, confirmed the rejection of the petitioner’s refund application.

Key Issues and Arguments:

The petitioner contested the rejection of their refund claim on the following grounds:

• The order confirming the rejection (February 24, 2022) was based on the unavailability of a crucial assessment order (August 23, 2012) on the Delhi Value Added Tax (DVAT) portal.
• The petitioner possessed the original assessment order and requested the authorities to consider it alongside original documents and Forms F.

Court’s Observations and Judgment:

The Delhi High Court acknowledged the petitioner’s argument and noted that the unavailability of the assessment order on the DVAT portal was the primary reason for rejecting the refund claim. The court then considered the following developments:

• On January 25, 2024, the petitioner presented the original assessment order, a certified copy, and original F-Forms to the competent authority for verification.
• The court was informed that the documents were duly verified by the department.

Based on the verification of the missing documents, the court concluded that the basis for the previous order (February 24, 2022) was no longer valid. Therefore, the court:

• Set aside the order dated February 24, 2022.
• Remitted the matter back to the competent authority for a fresh assessment of the petitioner’s refund application.
• Directed the competent authority to pass consequential orders within four weeks from the judgment date.

Conclusion:

The Kesri Steels Limited vs Commissioner of Delhi Goods and Service Tax case showcases the significance of accurate record-keeping and timely document verification in GST matters. The case also demonstrates the role of courts in ensuring fair and just resolution of disputes by considering verifiable evidence presented by petitioners.

FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT

1. Petitioner impugns order dated 27.11.2011, whereby, a default assessment of tax and interest was framed and zero amount was found due to the petitioner. Petitioner is also aggrieved by order dated 24.02.2022 passed by the Additional Commissioner, Zone-IV, pursuant to directions dated 22.11.2021 issued by this Court in WP (C) 10556/2021. Said order confirmed the order dated 27.12.2011 rejecting the refund application of the petitioner.

2. Learned counsel for petitioner had submitted on 25.01.2024 that one of the reasons for confirming the rejection of refund was that the assessment order dated 23.08.2012 was not available on the DVAT Portal. Learned counsel for petitioner had submitted that the original order was available with the petitioner and could be provided for inspection to the concerned competent authority along with the original F-Forms.

3. On 25.01.2024, petitioner was directed to appear before the competent authority with the original documents for verification.

4. We are informed by the learned counsel for respondents that petitioner had produced the relevant original documents, certified copy of the order as well as original F- Forms which have been duly verified.

5. In view of the fact that the basis of the impugned order was non-availability of certain record, which has now been verified by the department, we are of the view that the impugned order dated 02.2022 is liable to be set aside and the matter calls for a remit.

6. In view of the above, order dated 24.02.2022 is set aside. The matter is remitted to the competent authority to pass consequential orders in respect of the refund application of the petitioner.

7. Consequential orders be passed within a period of four weeks from today.

8. Petition stands disposed of.