M/s. Saraf Natural Stone (referred as ‘SNS’), is partnership firm engaged in exporting of marble or natural stones, has refund claim for the exports made, the department had paid the refund to the petitioners after a long period. SNS approached the High Court seeking interest in the nature of compensation for delay in making payment of the IGST refund paid on export of goods.
Honourable High Court pronounced that according to Section 54 read with Rule 91 provisional refund of 90% is to be granted within 7 days from the date of acknowledgement of the refund claim. Further, held that “the provisions relating to an interest of delayed payment of refund have been consistently held as beneficial and non-discriminatory. It is true that in the taxing statute the principles of equity may have little role to play, but at the same time, any statute in taxation matter should also meet with the test of a constitutional provision.”
Hon’ble High Court held that the simple interest is payable, at the rate of 9%, by the department from the actual date of filing of GSTR-3B till the actual date of receipt of the refund, on delayed payment of IGST refund.
According to the ruling of the Hon’ble Gujarat High Court interest @ 9% could be claimed by the exporters on account of delay in payment of refund claims filed from the actual date of filing of GSTR-3B to the actual date of receipt of refund irrespective of ARN date, date of Form GST RFD-02 or physical submission.