Bharat Oil Traders Vs Assistant Commissioner & anr. (Jammu & Kashmir High Court)
The Jammu and Kashmir High Court allowed the writ petition and held that the right to claim GST refund is a vested right which cannot be curtailed by retrospective application of the 2019 amendment to Section 54 of the CGST Act. The petitioner, a partnership firm engaged in refilling and sale of edible oil and ghee, was registered under the CGST/SGST Acts and operated under an inverted tax structure, where the tax rate on inputs was higher than the rate on outward supplies. As a result, it became entitled to refund of accumulated input tax credit under Section 54(3)(ii).
Originally, up to 31.01.2019, the “relevant date” for claiming refund of unutilized input tax credit was defined as the end of the financial year in which the claim arose. With effect from 01.02.2019, pursuant to the CGST Amendment Act, 2018, this definition was substituted to mean the due date for furnishing the return under Section 39 for the period in which the refund claim arose. The petitioner’s refund claims pertained to the period from July 2017 to March 2019, covering Financial Years 2017–18 and 2018–19. The refund application was filed on 02.02.2021.
