M/S. Sree Metaliks LTD. vs. Commissioner Of CT And GST Odisha, Cuttack

Facts

The Petitioner, M/s. Sree Metaliks Ltd., approached the High Court of Orissa under Article 226/227 of the Constitution of India. They challenged the rejection of their refund application for Rs. 46,84,171/- under the Central Sales Tax (CST) Act, 1956, for the tax periods from 01.04.2011 to 31.03.2012. This rejection was communicated by the Joint Commissioner of Sales Tax, Barbil Circle, vide a letter dated 23rd August, 2022. The Petitioner had previously filed a second appeal before the Odisha Sales Tax Tribunal, which had set aside both the appellate order and the provisional assessment order. Following the Tribunal's order, the Petitioner filed the refund application on 17th June, 2022. The Joint Commissioner rejected the refund claim, stating it did not arise from an order of refund.

Held

The High Court noted that subsequent to the filing of the writ petition, the Joint Commissioner of Sales Tax, Barbil Circle, issued a communication dated 7th September, 2022, withdrawing the rejection order dated 23rd August, 2022. This withdrawal was based on the decision of the apex court in the case of Ghanashyam Mishra & Sons (P) Ltd. v. EDELWEISS Asset Reconstruction Co. LTD and the order of the Odisha Sales Tax Tribunal dated 21st May, 2022. In light of this development, the Court found the writ petition to be infructuous. The Court directed the Petitioner to appear before the Joint Commissioner of Sales Tax on 20th September, 2022, to produce all relevant documents for the adjudication of the refund claim. The Joint Commissioner was directed to fix a date for document production and pass necessary orders in accordance with law, with the expectation that the entire exercise would be completed within two months from the Petitioner's appearance.

Key Issues

1. Whether the Joint Commissioner of Sales Tax erred in rejecting the Petitioner's refund application for Rs. 46,84,171/- for the tax periods 01.04.2011 to 31.03.2012, on the grounds that it did not arise from an order of refund, despite the Odisha Sales Tax Tribunal's order setting aside the assessment order. Petitioner's Contention: The Petitioner argued that the Joint Commissioner erroneously appreciated the factual position and rejected their refund application. They contended that the Tribunal's order, which set aside the assessment order, should have facilitated the refund process. They relied on the Tribunal's order dated 21st May, 2022, and certain Supreme Court judgments under the Insolvency and Bankruptcy Act, 2016. Revenue's Contention: The Revenue, represented by the Additional Standing Counsel, did not explicitly argue against the refund claim in the initial stages. However, subsequently, the Joint Commissioner of Sales Tax issued a communication withdrawing the rejection order.