TMI Blog2024 (3) TMI 393X X X X Extracts X X X X X X X X Extracts X X X X ..... dealt with by the appellate authority and it went on giving the entire order on merits. Further, from perusal of the impugned rejection order of refund dated 31.07.2020 (Annexure-6), it transpires that the same is also non-speaking order i.e., without recording any reasons, though the same is mandatory under Rule 92(3) of the Rules, 2017, and therefore unsustainable and is fit to be quashed, inasmuch as, none of the submissions made by the petitioner has been considered and the claim of refund was rejected on the ground that P.H. scheduled on 30.07.2020, in this case, was not attended and no documents were uploaded/submitted to clarify/resolve the discrepancies as pointed in the SCN uploaded dated 15.07.2020 in form RFD-08 (Annexure-3). The principles of natural justice have not been followed in the instant case. As such, interest of justice would be sufficed by remitting the case to the respondent no. 3, to start proceeding from the stage of personal hearing. The instant writ application is allowed. - HON BLE MR. JUSTICE RONGON MUKHOPADHYAY AND HON BLE MR. JUSTICE DEEPAK ROSHAN For the Petitioner : Mr. Biren Poddar, Sr. Advocate M/s. Deepak Sinha, Piyush Poddar, Manav Poddar, Ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l in Form GST APL-01 against rejection of refund on export supplies and also filed a refund application for claiming refund of cess for the Financial Year 2017-18 in GST RFD-01 on 13.03.2020 for refund of an amount of Rs. 2,01,53,182.00/- on account of SEZ and direct export and accordingly a Refund ARN Receipt was duly issued to the petitioner (Annexure-1). After filing of the said refund application dated 13.03.2020 (Annexure-1), the petitioner Company once again filed a revised refund application dated 26.06.2020 claiming refund of Rs. 1,93,21,127/- on account of export sales without payment of tax for the Financial Year 2017-18 (Annexure-2). After filing of the refund application dated 26.06.2020 (Annexure-2), the petitioner was served with a show-cause notice for rejection of application for refund in Form GST-RFD-08 dated 15.07.2020, asking the petitioner, as to why the claim of refund, to the extent of the amount specified above, should not be rejected (Annexure-3). 4. The case of the petitioner is that the SCN dated 15.07.2020 (Annexure-3), was served upon the petitioner on 16th July, 2020 at 3:20 p.m. via mail. He was given 15 days time from the date of service, to reply to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate Authority, wherein all the relevant grounds were raised by the petitioner. The Appellate authority has passed an order without considering the grounds raised by the petitioner and its submission before the appellate authority, which is bad in law. He strenuously contended that entire proceedings initiated by the Respondent Department in rejecting the refund claim of the petitioner is totally in violation of the principles of natural justice, as no opportunity of hearing was granted to the petitioner and even the show-cause reply dated 31.07.2020 filed by the petitioner within a period of limitation i.e., 15 days, from the date of receipt of SCN, has not been considered. He further contended that the date of hearing on the said show-cause notice was fixed by the respondent no. 3 on 30.07.2020 which is 14th day from the date of receipt of the show-cause notice, inasmuch as, the SCN dated 15.07.2020 (Annexure-3) was served on the petitioner on 16th July, 2020 at 3:20 P.M. via mail. Since the petitioner was given a 15 days time from the date of service, to reply to the reasons mentioned by the respondent no. 3 i.e., by 31st July, 2020; but surprisingly, the respondent no. 3 without ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it is evident that principles of natural justice have been followed. Since the petitioner failed to upload its reply on scheduled date of personal hearing on 30.07.2020; the concerned respondent thought that the petitioner ignored the personal hearing. On 15.07.2020, show-cause notice was issued to the petitioner through GST Portal and on 16.07.2020, the same was uploaded. On 16.07.2020 the SCN was also emailed as reminder. In the SCN, it was clearly mentioned to file a reply within 15 days and the date 30.07.2020 was fixed for personal hearing and since the reply to SCN has never been submitted on GST Portal within the stipulated date and hard copy of reply was submitted on 31.07.2020; however, on 31.07.2020 the OIO was passed. He reiterated that opportunity of hearing was granted on 30.07.2020, but the same was not availed by the petitioner and the reply was neither uploaded on GST Portal nor submitted in the office of the respondent within the stipulated time. Learned counsel for the Revenue lastly submits that the Appellate Authority has considered the entire gamut of the case and rejected the case of the petitioner on merits; as such no interference is required and the instan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent refund is allowed. The proviso to the aforesaid Rule-92(3) of the Central Goods and Service Tax Rules, 2017, provides as under: Provided that no application for refund shall be rejected without giving the applicant an opportunity of being heard. Thus, the aforesaid Rule 92(3) along with the proviso thereof, prescribes the procedures to be followed by the Proper Officer, for adjudication of the refund application, in the following manner: (i) To issue show-cause notice in FORM GST RFD-08 for filing reply by the applicant within fifteen days from the date of service of notice in FORM GST RFD-09 (ii) To provide personal opportunity of hearing to the applicant before passing the rejection order of application for refund. (iii) To pass the rejection order in Form GST RFD-06. From perusal of the aforesaid Rules, it is crystal clear that the refund application cannot be rejected without hearing the applicant (petitioner herein) and in the instant case, admittedly; the rejection order dated 31.07.2020 (Annexure-6) has been passed without providing any opportunity of hearing to the petitioner, which would be evident from the following facts: (a) SCN dated 15.07.2020 (Annexure-3) has bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of judicial pronouncements the said expression has been made central to the decision making process, breach of which would be construed to be violation of the principles of natural justice thus adversely affecting the decision making process; a ground for invoking the power of judicial review . Similar view was taken by the Karnataka High Court in the case Asiatic Clinical Research Pvt. Ltd. V. Union of India, reported in MANU/KA/0502/2021. Similarly, the Delhi High Court on the similar issue in the case of Richie Rich Exim Bolutions Vs. Commissioner or CGST Delhi South reported in MANU/DE/1078/2022 , has allowed the application of the Assessee and the order of rejection of application of refund was quashed and set aside. 11. At this stage, it is also profitable to refer the Master Circular No. 1053/02/2017-CX dated 10.03.2017 issued by the Government of India, which also incorporates the concept of granting a personal hearing after filing of a reply. Relevant clause is extracted here under: 14.3 Personal hearing: After having given a fair opportunity to the noticee for replying to the show cause notice, the adjudicating authority may proceed to fix a date and time for personal h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt case, the petitioner had made an application for refund under Section 54 of the Act and when the respondent has issued notice to them for rejection of the ineligible goods and services of SGST, CGST and IGST, they have given a detailed reply, objecting to the parties. All these objections were required to be dealt with by the authority, before taking a final call, which is conspicuously absent. As such, the order itself can be termed to be a non-speaking order and therefore, are liable to be set aside. However, if the respondent is granted an opportunity to pass fresh orders, after considering the objections of the Petitioner, the end of justice could be secured. Similar view has also been taken by the Bombay High Court in the case of Colgate Global Business Services Pvt. Ltd. Vrs. Union of India Ors. reported in MANU/MH/0240/2022 , wherein at para-5 it has been observed as under: 5. A perusal of the impugned order indicates that the respondent no. 3 has rejected the application for refund without recording any reasons, though the same is mandatory under Rule 92(3) of the Central Goods and Services Tax Rules, 2017. In our view, the order passed by the respondent no. 3 is in brea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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