Whether refund claim was time barred or not to be reconsidered as Limitation of 2 Years started from the insertion of Rule 89(1A)

Axis Bank Limited Vs Union of India (Andhra Pradesh High Court)

Conclusion: Since the impugned order of rejecting the refund claim was passed on 23.11.2020 and this Circular came to be issued on 25.09.2021 giving a clarification as to the date for claiming refund under Section 89 of the CGST Act, and Section 19 of the IGST Act, 2017, therefore, the matter was remanded back to the authority to deal with the refund application in the light of the Circular No.162/18/2021-GST dated 25.09.2021, issued more particularly with regard to the applicability of the Circular issued by the Government, and then pass orders in accordance with law.

Held: Assessee-bank was  said to be the third largest Private Bank in India providing an entire spectrum of financial services for personal and corporate banking. It filed refund applications for the IGST paid for the years July, 2017 to August, 2019 on 14.02.2020 in Andhra Pradesh. The amount according to the assessee was Rs.16,90,41,709/-. A Show Cause Notice was issued calling upon the assessee, as to why the refund claim should not be rejected on the ground that the refund claim was time barred as per Section 54. A reply came to be submitted by assessee on 16.04.2020 explaining the same, but the application came to be rejected on the ground that the claims were time barred and the details regarding excess payment of tax had not been reflected. It was held that reading of the Circular No.162/18/2021-GST and Column No.3 of 4.3 relating to refund claim, it was clear that if “A” had paid tax under a correct head before issuance of notification No.35/2021-Central Tax dated 24.09.2021, the last date for filing refund application in FORM GST RFD-01 would be 23.09.23 (two years from date of notification). In case, the adjudicating authority hold that the transaction as an inter-State supply and if ‘A’ pays IGST in respect of transaction on 10.05.2019, the last date for filing refund application would be 23.09.2023. However, if a particular person pays IGST on the same transaction on 10.11.2022 i.e. after issuance of notification No.35/2021, the last date for filing would be 09.11.2024. Relying upon the said Circular and transactions and having regard to the above Circular issued, assessee bank sought remand of the matter, but the same was opposed. It was also to be noted here that the impugned order was passed on 23.11.2020 and this Circular came to be issued on 25.09.2021 giving a clarification as to the date for claiming refund under Section 89 of the CGST Act, and Section 19 of the IGST Act, 2017. But the entire counter of the respondents was only in relation to Section 54 of the CGST Act, even the authority who passed the impugned order could not have considered the Circular issued by the Ministry of Finance in September, 2021, as the same was not issued by the date of the impugned order. Since the issue involved related to period of limitation in filing the refund application, coupled with the documents to be filed, it would be just and proper the matter was remanded back to the authority to deal with the refund application in the light of the Circular No.162/18/2021-GST dated 25.09.2021, issued more particularly with regard to the applicability of the Circular issued by the Government, and then pass orders in accordance with law.

FULL TEXT OF THE JUDGMENT/ORDER OF ANDHRA PRADESH HIGH COURT

Aggrieved by the Order, dated 23.11.2020, passed by the Additional Commissioner [GST-Appeals], the present Writ Petition came to be filed.

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