2025 (5) TMI 1726 - HC - GST

Seeking cancellation of refund order in form GST RFD 01 - benefit of the refund credited to the petitioner no.1 s credit ledger - HELD THAT - Considering the submission made on behalf of the respective parties and noting that the appellate authority had allowed the petitioners appeal arising out of the refund/rejection order dated 11th February 2022 by order dated 15th October 2023 and the proper officer on the basis of the petitioners subsequent application had allowed the refund by directing the same to be paid to the petitioners bank account however in the detailed order it appears that there is a direction to credit the refund amount to credit ledger of the petitioner no.1 which appears to be self- contradictory. Having regard thereto I direct the proper officer to reconsider the aforesaid direction in the light of the observation made herein. The aforesaid order is passed on the basis that the petitioners have closed down its business operation and its registration under the said Act has already been cancelled and that there is no tax due and payable by the petitioners.

Summary

The Calcutta High Court addressed a writ petition challenging a refund/rejection order dated 11th February 2022. The appellate authority, by order dated 15th October 2023, allowed the petitioners' appeal and directed refund proceedings. The petitioners, having closed their business and cancelled their GST registration, sought refund payment directly to their bank account. Although the refund sanction order dated 29th November 2023 authorized payment of Rs. 68,66,238/- to the petitioners' bank account, it simultaneously directed crediting the amount to the petitioner's GST credit ledger, creating a "self-contradictory" position.The Court held that since the petitioners' business is closed and registration cancelled, refund credit to the ledger is inappropriate. It directed the proper officer to reconsider the refund payment mode in light of these facts, providing the petitioners an opportunity of hearing. The reconsideration must be completed within six weeks. The writ petition (WPA 3033 of 2025) was disposed of with no order as to costs.