M/S. Ag Exports vs. The Assistant Commissioner Of State Tax

Held

The Court held that the impugned order rejecting the refund claim needed interference. The rejection was based on a Government Notification dated December 14, 2020, which extended the time only until March 31, 2021. However, the Court noted that this notification predated the Supreme Court's order dated March 29, 2021, and subsequent orders concerning the extension of limitation. The Court emphasized that the directions of the Supreme Court would prevail. Specifically, the Supreme Court's order clearly indicated that the period from March 15, 2020, to October 2, 2021, shall stand excluded for computing the period of limitation for any suit, appeal, application, or proceeding. Since the petitioner's refund application was filed on April 12, 2021, they were entitled to the benefit of this Supreme Court order. Consequently, the Court set aside the impugned order and remanded the matter to the first respondent for fresh consideration of the petitioner's refund claim, directing that the decision be made expeditiously, preferably within two months.

Facts

The petitioner, M/s. A.G Exports, filed a writ petition challenging the rejection of its refund claim for the tax period April 2018 to February 2019. The refund application was filed on April 12, 2021. The Assistant Commissioner of State Tax, Ongole, rejected the claim on October 22, 2021, citing that it was filed beyond the statutory period, as extended by government notifications. The petitioner argued that the Supreme Court's suo motu cognizance for extension of limitation, particularly its order dated January 10, 2022, and subsequent orders, should apply. The respondents contended that the relevant government notification extended the time for such actions only until March 31, 2021, making the April 12, 2021, filing date beyond the permissible period.

Key Issues

1. Whether the rejection of the petitioner's refund claim for the tax period April 2018 to February 2019, filed on April 12, 2021, was valid, considering the "relevant date" prescribed under Explanation (2)(e) of Section 54 of the Central Goods and Service Tax Act, 2017, and the impact of the Supreme Court's orders on extension of limitation. Petitioner's arguments: The petitioner contended that the refund application was filed within the extended period of limitation granted by the Supreme Court in Miscellaneous Application No. 21 of 2022 in SMW(C) No. 3 of 2020 (Cognizance for Extension of Limitation). They argued that the period from March 15, 2020, to October 2, 2021, should be excluded for computing the limitation period, and the balance period remaining as of March 15, 2021, should be available from October 3, 2021. They also relied on notifications from the Ministry of Finance and circulars from the Central Board for Indirect Taxes and Customs, and argued that the rejection violated principles of natural justice due to lack of personal hearing. Respondents' arguments: The respondents argued that the refund claim was filed after the expiry of the extended period as per Government Notification No. 91/20 dated December 14, 2020, which extended the time for certain actions only up to March 31, 2021. They contended that the petitioner's filing on April 12, 2021, was therefore beyond the permissible limit.