9911796707
TMI Blog2021 (11) TMI 152X X X X Extracts X X X X X X X X Extracts X X X X ..... d directing the 5th respondent - Director-General Analytics and Risk Management, New Delhi, to remove system alert and issue No Objection Certificate for exports made by the petitioner. 2. The petitioner contends that it is an MSME unit in the manufacturing and exporting of products, like Copper Rods, Copper Billet/ Ingot/Bus Bars, Paper Insulated Copper Conductor, Field Coil, Copper Nuggets, Copper Tube and pipe, Copper Wire etc. and is registered under the GST law and is under the jurisdiction of the State GST Department. 3. It is contended that during the period - February, 2021 to May, 2021, the petitioner had exported Copper Billets to China through Integrated Customs Depot, Sanathnagar, Hyderabad (ICD), on payment of Integrated Goods and Service Tax (IGST), in terms of the provisions of Integrated Goods and Service Tax Act, 2017 (for short, 'the IGST Act'); that as per Section 54 of the CGST Act read with Rule 96 of the Central Goods and Services Tax Rules, 2017 (for short, 'the CGST Rules'), it is entitled for refund in IGST paid on goods exported out of India. 4. It is further contended that the shipping bills filed by the exporter shall be deemed to be an application fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m the Chief Commissioner of Central Tax, the Custom Officer at the port of export shall proceed to process the IGST refund to the extent verified by the GST authorities. 7. The petitioner contends that as the refund and drawback claims of the petitioner were pending in relation to exports made since 15th February, 2021, on issuance of Instruction No.10/21-Customs, dt.13.05.2021 by CBIC, whereunder 'a Special Refund and Drawback Disposal Drive' was initiated, the petitioner addressed letter dt.14.05.2021 to the Chief Commissioner of Central Tax and Customs, for release of pending IGST refund. On seeking processing of refund of IGST, the jurisdictional CGST authorities issued an e-mail dt. 17.05.2021 to the petitioner informing it that certain clarifications were required from the petitioner along with supporting documents as specified thereunder; that the petitioner by e-mail dt.19.05.2021 provided all the required details and sought to remove system alert and to process the IGST refund. 8. As various communications addressed by the petitioner did not elicit any response from the Chief Commissioner of Central Tax and Customs or the jurisdictional authority, the petitioner had addr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... centive; that samples may be drawn, in case it is found necessary, and record of the same be made in the column provided for shipping them; that to conduct 100% examination to rule out any misdeclaration of description/value before allowing export; and that to suspend refund scroll till 100% examination is undertaken. 13. The respondents also contend that it is based on such alert issued by the 5th respondent, whereby the petitioner has been identified as risky exporter, detailed analysis of supply chain was conducted for the petitioner, whereby it was found that for the period - April, 2019 to March, 2021, the petitioner availed ITC to the tune of Rs. 44.92 crores; that there are 30 suppliers with suspicious GST credentials from whom ITC is flowing out to the petitioner; out of 30 suspicious suppliers, 10 suppliers have been identified as fake ITC issuers/availers and that the total ITC flowing out of these suppliers is of Rs. 3,32 crores; and that only on receipt of verification from field formations, NOC can be processed by the 5th respondent; since the said verification/investigation is in progress, further action could not be taken for removing the system alert on the petitio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in that the credit availment during the relevant period, is found to be in order in terms of Rule 36(4) of the CGST Rules. Further, by letter dt. 17.05.2021 addressed by the Commissioner of Central Tax and Service Tax to the Chief Commissioner, it has been stated that verification with respect to petitioner identified as L2 supplier/exporter has been completed and report in terms of CBEC SOP dt.23.01.2020 along with check list was forwarded to the 5th respondent on 27.04.2021 and no further action is pending at his end in the matter. 20. All the above communications, emanated from the jurisdictional authority, clearly reveal that not only the export consignment of the petitioner has been verified as per the system alert, but the authorities also completed verification of the suppliers of the petitioner in L1 and L2 stage. Though in the counter-affidavit it is stated that out of 30 suppliers, 10 suppliers with proportion of ITC of Rs. 3.32 crores, out of total ITC availed of Rs. 44.92 crores, are identified as suspicious suppliers, the said suppliers and the value of ITC availed is less than 10% of the total ITC availed. 21. Even if the claim of the respondents as to non-completio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efunds 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. 25. In spite of such clear instructions having been issued by the Board for completing verification specifying the maximum period of three weeks and to send a report to the 5th respondent, in the facts of the present case, though more than three months have passed by, the refund application, at least, to the extent admitted to be genuine by the respondents as L1 and L2 suppliers, has not been processed and refund granted. The consequence of inaction on the part of the respondents would result in the provisions of Section 56 of the CGST Act getting attracted, making the respondents liable to pay interest for such delayed refund either on provisional basis or otherwise. 26. In view of the above, 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 Rs. 14,78,99,959/-, cannot be held to be valid and also the non-grant of All Industry Drawback claimed by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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