Infor (INDIA) Private Limited vs. Union Of INDIA

Held

The Court held that the impugned Order-in-Appeal and the Orders-in-Original deserved to be set aside, along with the original refund orders. The Court reasoned that the Circular No. 159/15/2021-GST, issued during the pendency of the writ petition, provided a clarification on the scope of "Intermediary services" which had not been considered by the authorities below. The Court found it appropriate to remit the matter back to the concerned respondents for fresh reconsideration in accordance with law, taking into account the said Circular and providing the petitioner with an opportunity to file additional pleadings and documents. The ratio decidendi is that subsequent clarifications in circulars, if relevant to the matter under consideration and not previously considered by the adjudicating authorities, warrant a reconsideration of the case. The Court allowed the petition, set aside the impugned orders and refund orders, and remitted the matter back to the respondents for fresh adjudication.

Facts

The petitioner, INFOR (INDIA) PRIVATE LIMITED, sought to quash an Order-in-Appeal dated April 27, 2020, and two Orders-in-Original dated July 24, 2020, which rejected a refund claim of Rs. 2,58,50,733/-. The petitioner had initially received refund orders between February 11, 2019, and December 14, 2019. The respondents appealed these initial refund orders, leading to the Order-in-Appeal which allowed the appeal. Consequently, the Orders-in-Original were passed, rejecting the petitioner's refund claim. The petitioner challenged these orders before the High Court. During the pendency of the writ petition, a Circular No. 159/15/2021-GST dated September 20, 2021, was issued clarifying the scope of "Intermediary services".

Key Issues

1. Whether the impugned Order-in-Appeal dated 27.04.2020 and the Orders-in-Original dated 24.07.2020, which rejected the petitioner's refund claim of Rs. 2,58,50,733/-, are liable to be quashed, considering the subsequent issuance of Circular No. 159/15/2021-GST dated 20.09.2021? (Question of law and mixed fact and law, turning on the interpretation of "Intermediary services" under GST law and the applicability of the subsequent circular). Petitioner's contentions: The petitioner argued that the subsequent Circular No. 159/15/2021-GST, which clarifies that sub-contracting for a service is not an intermediary service, was not considered by the Appellate Authority or in the Orders-in-Original. Therefore, the impugned orders deserve to be set aside. Respondents' contentions: The respondents contended that the writ petition is not maintainable due to the availability of alternative remedies by way of appeal to the Appellate Authority and the Tribunal. They further submitted that if the impugned orders were quashed, the original refund sanctioning orders should also be set aside, and the matter remitted back for reconsideration.