Bharat Mint & Aroma Chemicals Vs Union of India And 2 Others (Allahabad High Court)
Allahabad High Court has quashed an order by a GST appellate authority that denied a tax refund to Bharat Mint & Aroma Chemicals. The court ruled that the refund claim was wrongly rejected on two technical grounds, finding the authority’s approach to be flawed and a violation of the principles of natural justice.
The company had sought a refund of excess Central Goods and Services Tax (CGST). While the application was for a CGST refund, the amount was mistakenly entered under the Integrated Goods and Services Tax (IGST) head in the electronic form. The appellate authority rejected the claim, stating the application was filed under the “wrong head” and that the company had “failed to adduce any evidence to buttress their claim.”
The High Court, after hearing the arguments, found that the error was a mere technicality. The court noted that a substantive claim for a refund cannot be denied solely because of a clerical or typographical error in a form, especially when the claim’s true nature—a CGST refund—was clear from the application itself. The court observed that the appellate authority had neglected to consider the application on its merits and had instead focused on the formal error. The court also pointed out that the finding of insufficient evidence was made without any prior notice to the company, thus violating the principles of natural justice. The court’s ruling sets a clear precedent against rejecting claims based on technicalities without a proper hearing on the merits. The matter has been sent back to the appellate authority for a fresh decision.
