M K Agrotech Private Limited Vs Union of India (Karnataka High Court)
The petitioner filed the writ petition seeking quashing of the order dated 27.04.2023 rejecting its GST refund claim, a direction to grant the refund with interest, and a declaration that Circular No.181/13/2022-GST dated 10.11.2022 was ultra vires the CGST/KGST Act, 2017, Notification dated 13.07.2022, and unconstitutional. The petitioner also sought other appropriate reliefs in the interests of justice and equity.
The petitioner contended that the issues involved in the writ petition were directly covered by earlier judicial decisions, namely MK Agro Tech Pvt. Ltd. Vs. Union of India, Indian Oil Corporation Ltd. Vs. Assistant Commissioner of Central Tax, M/s. Priyanka Refineries Pvt. Ltd. and Gemini Edibles and Fats India Ltd. Vs. DCCT and Ors., Patanjali Foods India Vs. Union of India, and Shree Proteins Pvt. Ltd. v. Union of India. It was submitted that these judgments had not been considered by the authority while passing the impugned order rejecting the refund claim.
The High Court examined the impugned order dated 27.04.2023 and observed that the aforesaid judgments and the legal principles enunciated therein had not been considered by the respondent while rejecting the petitioner’s refund claim. The Court therefore held that the impugned order deserved to be set aside and the matter remitted for fresh consideration in accordance with law.
The respondents had rejected the refund claim on two grounds: first, that the rate of tax on the input and output supplies was the same, and secondly, that Notification No.9/2022 dated 13.07.2022 operated retrospectively. The petitioner submitted that the issue relating to the rate of tax on input and output had already been decided in favour of taxpayers in MK Agro and Indian Oil Corporation. It was further submitted that the issue regarding whether Notification No.9/2022 dated 13.07.2022 was prospective or retrospective had been answered in favour of the taxpayer in M/s. Priyanka Refineries Pvt. Ltd. and Gemini Edibles and Fats India Ltd., and that the said view had been confirmed by the Supreme Court in Assistant Commissioner of Central Taxes and others Vs. M/s. Gemini Edibles and Fats India Limited and another.
The High Court accepted the petitioner’s submission that the issue concerning the rate of tax on input and output under Section 54 of the CGST Act, 2017 had been answered in favour of the petitioner in Indian Oil Corporation. The Court also observed that Notification No.9/2022 dated 13.07.2022 had been held to be prospective in nature in the earlier judgment that was subsequently confirmed by the Supreme Court.
In view of these circumstances, the Court held that the impugned order required to be set aside and the matter remitted to the concerned respondent for fresh consideration of the petitioner’s refund claim.
Accordingly, the High Court allowed the writ petition, set aside the impugned order dated 27.04.2023, and remitted the matter to Respondent No.3 for reconsideration of the petitioner’s refund claim, together with applicable interest, afresh and as expeditiously as possible.
FULL TEXT OF THE JUDGMENT/ORDER OF KARNATAKA HIGH COURT
In this petition, petitioner seeks for the following reliefs:-
“i. Issue Writ of Certiorari or Writ in the nature of Certiorari or any other writ, order or direction quashing the impugned order No. Refunds/GST/SO/03/2023-24, issued by Respondent No.3, dated 27.04.2023 at Annexure-K, in so far as the petitioner is concerned.
ii. Issue Writ of mandamus or Writ in the nature of mandamus or any other writ, order or direction directing the Respondents to grant refund claim to the Petitioner, along with interest; and/or
iii. Declare Circular No.181/13/2022-GST dated 10.11.2022 [Annexure-F] issued by respondent No.1 as ultra vires the CGST/KGST Act, 2017 and ultra- vires to the Notification dated 13.07.2022 at Annexure-D and as being unconstitutional; and/or
iv. Issue any other Writ or direction deemed fit in the facts and circumstances of the case in the interest of justice and equity including the cost of the Writ petition.”
2. Heard learned counsel for the petitioner and learned counsel for the respondents and perused the material on record.
3. Learned counsel for the petitioner submits that the issue in controversy involved in the present petition is directly and squarely covered by the following decisions:
i. MK Agro Tech Pvt. Ltd Vs. Union of India – W.P.No.1449/2024 & Connected Matters – dated 03.07.2025 (Karnataka).
ii. Indian Oil Corporation Ltd. Vs. Assistant Commissioner of Central Tax – 2025 VIL 318 KAR.
iii. M/s. Priyanka Refineries Pvt. Ltd. And Gemini Edibles and Fats India Ltd. Vs. DCCT and Ors. – 2025 VIL 113 AP (Department SLP dismissed – 2025-VIL-30-SC)
iv. Patanjali Foods India Vs. Union of India – 2025 VIL 213 GUJ (Gujarat).
v. Shree Proteins Pvt. Ltd v. Union of India – 2025 (5) TMI 373 – (Gujarat).
4. It is submitted that the aforesaid judgments having not been considered by the respondents while passing the impugned order rejecting refund claim of the petitioner, aggrieved by which, the petitioner is before this Court by way of the present petition.
5. A perusal of the impugned order at Annexure-K dated 27.04.2023 will indicate that the aforesaid judgment and the legal principle enunciated therein has not been considered by the respondent while passing the impugned order and hence, the impugned order deserves to be quashed and the matter be remitted back to the respondent for reconsideration afresh in accordance with law.
6. Learned counsel for the respondents has proceeded to reject the claim of the petitioner on the following two grounds:
i. Rate of tax and out put are one and the same.
ii. Notification No.9/2022 dated 13.07.2022 is retrospective in nature .
It is submitted that sofar as the findings recorded by the respondents that the rate of tax for input and output is one and the same, the said issue has been answered in favour of the petitioner as held in the cases of MK Agro and Indian Oil Corporation (supra).
7. It is also pointed out that the issue as to Notification No.9/2022 dated 13.07.2022 is perspective or retrospective has also been answered in favour of the petitioner/tax payer/assessee in the case of M/s. Priyanka Refineries Pvt. Ltd. And Gemini Edibles and Fats India Ltd (supra) has been confirmed by the Apex Court in the case of Assistant Commissioner of Central Taxes and others Vs. M/s. Gemini Edibles and Fats India Limited and another – 2025-VIL-30-SC and in view of the same, the matter deserves to be disposed of bearing in mind the aforesaid judgments.
8. Per contra, learned counsel for the respondents submits that there is no merit in the petition and that the same is liable to be dismissed.
9. As rightly contended by the learned counsel for the petitioner that the issue as to whether the rate of tax relating to number of output and input tax under Section 54 of the CGST act, 2017, is answered in favour of the petitioner as held in the case of Indian Oil Corporation (supra). So also, the Notification No.9/2022 dated 13.07.2022 has been held to be prospective in nature in the aforesaid judgment confirmed by the Apex Court.
10. Under these circumstances, I deem it just and appropriate to set aside the impugned order and remit the matter back to the concerned respondent for reconsideration of the refund in accordance with law.
11. In the result, I pass the following:
ORDER
i. The petition is allowed.
ii. The impugned order at Annexure-K dated 27.04.2023 passed by respondent No.3 is set aside.
iii. The matter is remitted back to respondent No.3 for reconsideration of the claim of the petitioner for refund together with applicable interest, afresh and as expeditiously as possible.
