State of Jharkhand & Ors. Vs Steel Authority of India Limited (Supreme Court of India)
The dispute arose from a claim for refund of unutilized Input Tax Credit (ITC) under the Goods and Services Tax regime and culminated in proceedings before the Jharkhand High Court, followed by a challenge before the Supreme Court of India.
The writ petition before the Jharkhand High Court sought quashing of an alleged refund rejection order dated 18.10.2019 and directions for refund of ₹2,90,86,294 for the period July 2017 to March 2018, along with statutory interest. The petitioner, a government company operating the Bokaro Steel Plant, is engaged in manufacturing iron and steel and is registered under the GST Act, 2017. In the course of manufacture, it procures coal attracting compensation cess under the Goods and Services Tax (Compensation to States) Act, 2017. Under the statutory scheme, unutilized compensation cess cannot be adjusted against CGST, SGST, or IGST, but is refundable in cases of export without payment of tax.
Read HC Judgment in this case: GST Refund Cannot Be Denied Without Valid Rejection Order: Jharkhand HC
Accordingly, the petitioner filed a refund application on 04.03.2019 in Form GST RFD-01A for ₹2,90,86,294 on account of ITC on export of goods and services without payment of tax. Clarifications sought by the jurisdictional Deputy Commissioner of State Tax were furnished. In October 2019, the petitioner received an email stating that order details in Form RFD-06 had been submitted. The GST portal showed the status as “refund sanctioned,” with payment advice in Form RFD-05 pending.
