M/S. Induvarna Lpg Bottling Private Limited vs. The Union Of INDIA

Held

The Court held that the present writ petition could not be entertained as the petitioner had not exhausted the statutory remedy of appeal before the appellate authority. The Court observed that the rejection of Rs. 1,31,240/- from the refund claim was based on the interpretation of Section 54 of the Central Goods and Services Tax Act, 2017, read with Rule 89(5) of the Central Goods and Services Tax Rules, 2017. This constituted a disputed issue that could not be adjudicated under Article 226 of the Constitution. The Court noted that the petitioner had not provided sufficient material information regarding the transaction of capital goods (Gas cylinder) and whether it was sold or supplied, which was crucial for qualifying for the refund. Prima facie, the provisions of Section 54 of the CGST Act and Rule 89(5) of the CGST Rules would be attracted. Therefore, the petitioner was relegated to the appellate authority to file a memorandum of appeal within eight weeks. The appellate authority was directed to decide the appeal within four months of its receipt.

Facts

The petitioner, M/s. Induvarna LPG Bottling Private Limited, sought a writ of certiorari and mandamus to quash a refund order dated 29.06.2024 and direct the refund of a balance amount of Rs. 1,31,240/-. The petitioner had claimed a refund of Rs. 6,12,487/- for the period October 2018 to March 2019 under the 'Inverted Duty Structure'. The refund order, passed by Respondent No. 6, partially allowed the claim, rejecting Rs. 1,31,240/-. This order was issued after a previous writ petition (CWJC No. 18609 of 2023) disposed of on 29.02.2024, which had directed the respondents to consider the refund application within two months. The petitioner also sought interest on the delayed refund and reimbursement of expenses incurred.

Key Issues

1. Whether the High Court, in its writ jurisdiction under Article 226 of the Constitution, can adjudicate a disputed refund claim where a portion has been rejected based on specific provisions of the GST Act and Rules? 2. Whether the petitioner is entitled to the balance refund amount of Rs. 1,31,240/-, considering the previous order of this Court and the nature of the transaction involving LPG cylinders and gas? Petitioner's arguments: The petitioner contended that this was a second round of litigation and that the previous writ petition (CWJC No. 18609 of 2023) had directed the respondents to process the refund, implying that the petitioner need not exhaust the statutory remedy of appeal. They argued they are rightfully entitled to the refund and sought interest and expenses due to the respondents' delay and disregard for the previous court order. Revenue's arguments: The respondents argued that the petitioner had rushed to the court without exhausting the remedy of appeal before the appellate authority. They highlighted that the rejection of Rs. 1,31,240/- was made in light of Section 54 of the Central Goods and Services Tax Act, 2017, read with Rule 89(5) of the Central Goods and Services Tax Rules, 2017, indicating a disputed issue.