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2023 (3) TMI 56 - HC - GSTRefund of IGST - Refund to the SEZ when it is not required to actually fulfill the supplier’s obligation as has been reiteratively contended before this Court - Export of Goods/Services without payment of tax - It is the case of the petitioner that CGST Act does not make any distinction between a SEZ unit and other registered persons so far as eligibility of ITC is concerned - according to the petitioner, the appellate authority erred in holding that Section 54(3) of the CGST Act read with Rule 89(1) and Rule 89(2)(f) of the CGST Rules mandates only the supplier to claim the refund of ITC - HELD THAT:- There is no express denial of refund of output tax or ITC to a SEZ under Section 54. Therefore, the averment that since the supply to SEZ unit is a zero rated, the units situated in SEZ are not eligible for refund under Section 54 of the Act is not sustainable. The SEZ since is considered as zero rated supply in terms of 16 of the IGST Act, such supplier is exempted from IGST. The notification No.15 of 2017 integrated tax dated 30th June, 2017 provides that the suppliers supplying the goods at SEZ can supply under the bond or electronic undertaking without payment of IGST and claim credit of ITC or can supply on payment of IGST or claim refund of taxes paid - It is an additional burden on the administration, the respondents authorities to verify whether the supplier has claimed the refund or not and whether the SEZ unit has actually paid the taxes to the supplier. A system since is not geared up for the same, the concern has multiplied. Any inadvertent payment of the amount of taxes to the supplier in wake of thousands of such transactions happening everyday in the SEZ, it is urged that no exceptions be made. An attempt is made to distinguish the matter on the facts and particularly, since the petitioner is non- SEZ by pointing out that the one which is decided in M/s. Britannia Industries [2020 (9) TMI 294 - GUJARAT HIGH COURT] is in relation to the credit of IGST distributed by ISD for the services pertaining to the SEZ unit, as it was not possible for a supplier to file refund application to claim the refund of ITC distributed by the ISD. It is also the stand of the department that the matter is pending in the form of SLP No.13431 of 2021 before the Apex Court. It is fairly admitted that no stay has been granted. Not only this decision but also M/s.IPCA Laboratories versus Commissioner in [2022 (2) TMI 947 - GUJARAT HIGH COURT] covers this issue squarely with a specific undertaking having been tendered along with the application for the refund that the supplier has not claimed any refund and any eventuality of the supplier having been given the refund, the petitioner is taking the responsibility to make good the amount which may have been given will need to be borne in mind and accordingly, this petition is allowed, quashing the order passed by the Commissioner (Appeals) for the period of September, 2018 to December, 2019 and Assistant Commissioner for the period of 2020 to November, 2021 that the respondent grant the refund of ITC to the petitioner after proper verification and by obtaining a specific undertaking / bond from the petitioner where by stating that if the supplier at any point of time has taken refund and it comes to the notice of the department, then department will be in a position to recover it with interest. Petition disposed off.
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