9911796707
TMI Blog2024 (11) TMI 785X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of the learned counsel for the parties. 2. By this petition under Article 226 of the Constitution of India, the Petitioner seeks interest on delayed payment of refund of tax as per Section 56 of the Central Goods and Services Tax Act, 2017 ("CGST Act"). Brief facts :- 3. The Petitioner is an exporter and supplier of Ethyl Alcohol Liquid Packaging Film, Iodized salt, etc. On export of the goods, the Petitioner makes payment of Integrated Goods and Services Tax ("IGST") and claims the refund of same based on shipping bills as per the provisions of Section 16 (3) of IGST Act read with Section 54 of CGST Act and Rule 96 of CGST Rules. 4. During the period August 2018 to July 2019, the Petitioner filed various shipping bills, which are c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the red flag tag was removed, and the refund was granted. Therefore, there was no delay in the grant of the refund. Mr. Mishra strongly objected to the Petitioner's claim for a grant of interest. The Respondents made no other submissions. 7. We have heard learned counsel for the Petitioner and Respondents. 8. The short point that arises for our consideration is whether the Petitioner is entitled to interest under Section 56 of the CGST Act for the period starting from the expiry of 60 days from the date of filing the shipping bill up to the date of grant of refund, although during the interregnum, the Petitioner's name was red flagged on the respondents' portal. 9. Section 56 of the CGST Act provides for the grant of interest o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll get the verification of IGST refund claims and other related aspects in accordance with the standard operating procedure to be issued by the CGST policy wing. A report shall be furnished within 30 days specifying clearly whether the amount of IGST paid and claimed as a refund is in accordance with the law or not, and after that, the Chief Commissioner shall comply and forward the report within five working days after that to the concerned Customs Port of Export. 11. The CGST Policy Wing, vide its Circular No. 131/1/2020 dated 23 January 2020, has stated that the verification shall be completed by jurisdictional CGST office within 14 working days of furnishing of information in proforma by the exporter and if the verification is not comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no adverse comment against the Petitioner insofar as non-compliance of any information sought by the Respondent is concerned or deficiency in any documents to be produced for the grant of refund. The delay is squarely attributable to the inaction of the Respondents in not completing the investigation within the time frame specified in the Circular, nor is any explanation given as to why the time limit specified in the Circular could not be complied with or same attributable to the Petitioner. In our view, the Petitioner cannot be made to suffer because of inaction or delay in the Respondent's action in completing the investigation after the Petitioner has been red flagged. Therefore, there is no reason why the Petitioner should be denied t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the denial of interest by the Respondents cannot be justified. If we accept the submissions of the Respondents, then the same would amount to rewriting the provisions of Section 56 of the CGST Act by this Court, which certainly is not permissible. 16. In view of the above, we declare and pass the following order:- ORDER (i) The Petitioner is entitled to interest under Section 56 of the CGST Act for the period beginning with the expiry of 60 days from the date of the shipping bill up to the date of grant of refund (ii) In calculating the above period, the 30-day period provided in Circular No.16 of 2019 will be excluded as a reasonable period provided in the Circular for completing the investigation. (iii) Interest must be calculat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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