Uma Polymers LTD vs. The Union Of INDIA And 3 Ors

Held

The Court did not decide the merit of the petitioner's refund claim. Instead, in view of the statement made by the learned Standing Counsel for the GST Department, the Court directed the Assistant Commissioner, GST, Guwahati to re-examine the petitioner's refund claim for deemed exports in terms of Circular No. 147/03/2021-GST dated 12.03.2021. The Assistant Commissioner was instructed to pass a reasoned order within one month of receiving a certified copy of the order. The petitioner was to be given an opportunity for a hearing and to produce relevant materials if necessary. The impugned orders dated 03.04.2020 and 06.11.2020 were to be given no effect until the new reasoned order was passed, and the new order would prevail. The Court explicitly stated that it had not expressed any view on the merit of the claim.

Facts

The petitioner, Uma Polymers Ltd., a public limited company, claimed a refund of IGST paid on deemed exports amounting to Rs. 32,65,200/-. The respondents issued a show cause notice, stating the refund was inadmissible under Section 54 of the CGST Act, 2017, as the petitioner had not followed the procedure in para 41 of Circular No. 125/44/2019-GST dated 18.11.2019. The petitioner responded that they had not availed input tax credit for the relevant invoices, but the online refund application process automatically debited their electronic credit ledger. They recredited the amount to nullify the technical issue. The writ petition sought to set aside the orders dated 03.04.2020 and 06.11.2020, which dealt with the show cause notice.

Key Issues

1. Whether the refund claim for IGST paid on deemed exports is admissible to the petitioner, considering the procedural non-compliance alleged by the revenue and the petitioner's explanation of a technical glitch on the GST portal, under Section 54 of the CGST Act, 2017 and Circular No. 125/44/2019-GST. Petitioner's arguments: The petitioner contended that they had not availed input tax credit and that the debit in their electronic credit ledger was due to a technical issue on the GST portal. They had taken steps to rectify this by recrediting the amount, thus asserting they were eligible for the refund. Revenue's arguments: The respondent GST Department argued that the refund was not admissible as the petitioner had not followed the procedure prescribed in para 41 of Circular No. 125/44/2019-GST dated 18.11.2019. However, the Standing Counsel for the GST Department later stated that the department agreed to re-examine the claim in light of Circular No. 147/03/2021-GST dated 12.03.2021.