Narayanan Manikantan & Co. Vs State Tax Officer (Kerala High Court)
Kerala HC Directs Refund Reconsideration Where Flood Cess Was Mistakenly Paid Through GSTR-3B; 5. Two-Year GST Refund Period Runs From Correct Kerala Flood Cess Payment: Kerala High Court
Summary: Kerala High Court allowed the writ petition of Narayanan Manikantan & Co., a registered taxpayer under the CGST/KGST Act, challenging rejection of its refund application relating to Kerala Flood Cess. The petitioner had paid Kerala Flood Cess for August 2019 to May 2020 along with Form GSTR-3B instead of making payment through the prescribed Form KFC-A. After proceedings were initiated for non-payment of the cess, the petitioner remitted the amount in the correct manner on 27.06.2025 and subsequently applied for refund on 30.07.2025 of the amount earlier paid through GSTR-3B. The authority rejected the refund as being beyond the two-year limitation under Section 54 of the CGST Act. Relying upon Pushpagiri Medical Society v. State of Kerala, the High Court held that where Kerala Flood Cess was mistakenly paid along with GSTR-3B, the relevant date for refund limitation is the date on which the cess was subsequently paid into the correct account.
Since the correct payment was made on 27.06.2025 and the refund application was filed on 30.07.2025, it was within the prescribed period. The Court therefore quashed the rejection order and directed the competent authority to reconsider the refund application as having been filed in time, pass appropriate orders within one month, and effect the refund immediately upon sanction.
