Aurobindo Pharma Limited vs. State Of Telangana

Held

The High Court, noting that an identical matter involving the same petitioner was previously decided, followed that precedent. It set aside the impugned orders, directing the original authority to reconsider the refund claims in light of the Gujarat High Court judgments in *Atul Limited* and *Patson Papers Private Limited*, which held that such refunds are permissible for zero-rated supplies.

Facts

Aurobindo Pharma Limited sought a refund of accumulated unutilized Compensation Cess paid on inputs used for manufacturing goods that were either exported (zero-rated supplies) or supplied to SEZ (exempted from tax). The Appellate Joint Commissioner rejected these refund claims, leading the petitioner to file multiple writ petitions challenging these orders.

Key Issues

Whether a taxpayer is entitled to a refund of unutilized Compensation Cess paid on inputs used for manufacturing goods that are subsequently exported or supplied to SEZ, which are zero-rated or exempted from tax.