Case Law Details

Case Name : Medical Bureau Vs Commissioner of Central Goods And Service Tax (Delhi High Court)
Appeal Number : W.P.(C) 7475/2021 & CM APPL. 23486/2021
Date of Judgement/Order : 02/08/2021
Related Assessment Year :

Medical Bureau Vs Commissioner of Central Goods And Service Tax Delhi North (Delhi High Court)

Medical Bureau (Petitioner) filed a writ petition seeking directions to the Commissioner of Goods and Services Tax (Respondent) to refund to the former, an amount of Rs. 1,35,30,255/- lying as unutilized input tax credit during the period spanning October 2017 to July 2018, along with interest.

The Petitioner contended that the present claims arose out of the failure of the Respondent to issue refund due to the Petitioner, owing to the exports made by the Petitioner, which qualified as ‘Zero-rated supplies’, the refund of which was covered under Section 16 (3) of the Integrated Goods and Services Tax Act, 2017 (IGST Act) read with Section 54 of the Central Goods and Services Tax Act, 2017 (CGST Act).

a hand with coins from a smartphone screen and a man taking money

The Hon’ble High Court of Delhi on finding that the relevant refund applications had not yet been disposed of, directed the original Adjudicating Authority to decide the above matter within a period of six weeks in accordance with the law.

FULL TEXT OF THE HIGH COURT ORDER /JUDGEMENT

1. The hearing has been conducted through video conferencing.

2. Present writ petition has been filed seeking direction to the Respondent to refund to the petitioner the amount of Rs.1,35,30,255/-, being unutilized input tax credit for the months of October 2017 to July 2018 along with interest thereon.

2. Learned counsel for the Petitioner states that the present Petition arises on account of the failure of the Respondents to issue the refund due to the petitioner under the provisions of the Integrated Goods & Services Tax Act, 2017 and the Central Goods and Services Tax Act, 2017 [CGST Act] resulting on account of exports made by the Petitioner out of India which are termed as ‘Zero rated supplies’ in GST.

3. He states that the Petitioner is engaged in the business of purchase and exports of pharmaceutical products. He adds that the Petitioner was registered with the Trade & Taxes Department under VAT and on the enforcement of Goods and Services Tax Act, the Petitioner migrated to the said system of taxation as provided in Section 139 of the Central and Delhi Goods and Services Tax Act, 2017.

4. He emphasises that the exports done by the Petitioner out of India are zero rated and therefore, in terms of Section 16 of the Integrated Goods and Services Tax Act, 2017 [IGST Act], the Petitioner is entitled to make exports on letter of undertaking and consequently, claim refund of unutilized input tax credit or in the alternative make exports on payment of integrated tax (IGST) and thereafter, claim refund of such tax paid on exported goods.

5. He points out that in terms of Section 16 (1) of the IGST Act, the supplies made by the Petitioner were “zero rated supplies” and the Petitioner became entitled to the refund of unutilized input tax credit as per Section 16 (3) of the IGST Act read with Section 54 of the CGST Act.

6. He states that the Petitioner has made available all the details for processing of refund to the Respondents and hence, there is no reason or ground whatsoever for the Respondents to sit over the refund of the Petitioner and deny the same.

7. He emphasises that the Petitioner ought to have been allowed 90% of the refund on Provisional basis and the remaining amount within sixty days as per Section 54 sub-section (6) and (7) of the CGST Act.

8. Issue notice. Notice is accepted by Mr.Harpreet Singh, senior standing counsel on behalf of the respondents. He prays for some time to file a counter affidavit. However, keeping in view the limited direction that we intend to pass, we are of the view that no counter affidavit is required.

9. Having perused the paper book, we find that the Petitioner’s refund applications being GST RFD-01A have not been disposed of till date. Consequently we direct the original Adjudicating Authority to decide the said refund applications within a period of six weeks in accordance with law in particular the judgment passed by this Court in Medical Bureau vs. Commissioner of Central Goods and Services Tax Delhi North & Ors., being WP(C) 3917/2020 dated 10th November, 2020. With the aforesaid direction the present petition along with pending application stands disposed of.

10. The order be uploaded on the website forthwith. Copy of the order be also forwarded to the learned counsel through e-mail.

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DISCLAIMER: The views expressed are strictly of the author and A2Z Taxcorp LLP. The contents of this article are solely for informational purpose. It does not constitute professional advice or recommendation of firm. Neither the author nor firm and its affiliates accepts any liabilities for any loss or damage of any kind arising out of any information in this article nor for any actions taken in reliance thereon.

(Author can be reached at [email protected])

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