In a major relief to Axis Bank, the Andhra Pradesh High Court has directed the GST department to re-consider the refund claim relying on the circular issued by the Central Board of Indirect Taxes and Customs (CBIC).
The Petitioner Bank paid IGST (Inter-state supply) from the State of Andhra Pradesh due to a mapping system error. It, subsequently, paid CGST and Telangana State GST. It paid tax twice. The refund claim was rejected by the department for erroneously paid IGST. The claim was rejected on the ground of the time bar (beyond 2 years from the date of payment of IGST) in terms of section 54 of the CGST Act. The part claim was rejected on the grounds that Petitioner did not provide supporting documents. There is no GST tribunal, hence, the Petitioner approached the High Court.
The High court set aside the rejection and remanded the matter back to the original authority. The High court referred to a circular dated 25.09.2021 issued clarifying that insertion of rule (1A) to Rule 89 provides a time limit of 2 years. The said two-year time limit would apply from the date of introduction of the said rule and not from the date of payment of GST. The High overruled objection of the Revenue against remand of the matter.
Justice C.Praveen Kumar Justice A.V. Ravindra Babu observed that “A reading of the Circular No.162/18/2021-GST and Column No.3 of 4.3 relating to refund claim, it is clear that if “A” has 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 holds 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, the learned counsel for the petitioner seeks remand of the matter, but the same is opposed strenuously by Sri Suresh Kumar Routhu, learned Senior Standing Counsel for the respondents.”
Adv. Bharat Raichandani appeared for the petitioners.
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