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2021 (11) TMI 152 - HC - GSTRefund of IGST - goods exported out of India - zero rated supplies - misdeclaration of description/value before allowing export - period February, 2021 to May, 2021 - HELD THAT:- The provisions of the CGST Act and the IGST Act do not mandate the petitioner to verify the genuineness of the suppliers of its supplier, inasmuch as enough safeguards/mechanism are provided under the Act to recover the taxes, if not paid or wrong credit is availed by the petitioner’s supplier or supplier’s supplier - Inasmuch as no discrepancy has been found with regard to the suppliers of the petitioner, the refund claim by the petitioner cannot be denied to be processed on the ground that verification of the suppliers of the petitioner’s supplier is pending. The reluctance on the part of the respondents in granting of refund to exporters upon completion of exports would result in taking away the incentive to export and would make the exports from the country unviable due to non-flow of funds in the form of refund assured under the Act. Further, the non-committal stand of the respondents in the counter indicating a time frame for completion of the verification in respect of L2 supplier also cannot be countenanced, since it is not the duty of the exporter, like the petitioner, to get such verification done, more so, when there is no such prescription to cause verification by the exporter, like the petitioner, before purchasing any goods from its supplier. The stand of the respondents in not completing the exercise, even if it is required to be undertaken at their end, is contrary to the instructions contained in internal circular No.20/16/07/2020-GST, dt.20.05.2020, issued by the Board wherein the Board had made changes to the SOP dt.23.01.2020 for verification of IGST refunds and specified that in future, all verifications are to be completed and report sent to the 5th respondent within a maximum period of three weeks of receipt of request for verification. The action of the respondents, and in particular the 2nd respondent, in not granting refund of IGST paid by the petitioner on exports made during the period - 15.02.2021 to 21.05.2021, in a sum of ₹ 14,78,99,959/-, cannot be held to be valid and also the non-grant of All Industry Drawback claimed by the 4th respondent, cannot be sustained. Petition allowed.
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