M/S. Globus Petroadditions PVT. LTD. vs. The Union Of INDIA And Ors

Held

The Court held that the Assistant Commissioner could not have refused to comply with the Order passed by the Commissioner (Appeals-II) on the ground that a decision was taken to impugn the said order before the GST Tribunal or on any other ground of dissent. The Court found that the Assistant Commissioner had refused to comply with the order of his superior authority by recording reasons as if he were sitting in appeal against the Commissioner's order. The Court observed that the Assistant Commissioner's action was not in accordance with law. The Court quashed and set aside the impugned order dated 12/02/2021 passed by the Assistant Commissioner. The Assistant Commissioner was directed to comply with the Orders in Appeal dated 14/10/2019 and 29/10/2020 passed by the Commissioner (Appeals-II) within four weeks, passing an appropriate order after granting an opportunity of being heard to the Petitioner. The Court emphasized that the Assistant Commissioner should not refuse compliance based on the decision to impugn the appellate order before the GST Tribunal.

Facts

The Petitioner, M/s. Globus Petroadditions Pvt. Ltd., filed refund claims for GST for Q2 and Q3 of 2018. These claims were initially rejected by the Assistant Commissioner (Respondent No. 3). The Petitioner appealed to the Additional Commissioner (Respondent No. 2), who set aside the rejections and allowed the appeals on 14/10/2019. Subsequently, the Petitioner filed fresh refund claims, which were again rejected by the Assistant Commissioner on 14/11/2019. The Petitioner appealed again, and on 29/10/2020, the Additional Commissioner set aside the Assistant Commissioner's order and directed a speaking order. The Petitioner filed a refund claim on 15/02/2020, but the Assistant Commissioner rejected it on 12/02/2021, citing a review order by the Commissioner Central Tax, Pune, which directed an appeal against the 14/10/2019 order. The Assistant Commissioner also noted that the refund was filed under the 'Any Other' category instead of the 'Nil refund' category and that subsequent period refund claims were filed, thus not fulfilling condition (b) of Circular No. 110/29/2019-GST. The Assistant Commissioner held the earlier appellate order as not legal and proper and that the refund claim was premature as an appeal was to be filed before the GST Tribunal.

Key Issues

1. Whether the Assistant Commissioner (Respondent No. 3) was justified in refusing to comply with the Order in Appeal dated 14/10/2019 passed by the Commissioner (Appeals-II) (Respondent No. 2) on the ground that the department intended to challenge the said order before the GST Tribunal, which was not yet constituted? (Question of law turning on the principle of hierarchy of authorities and compliance with appellate orders). Petitioner's Contention: The Petitioner argued that the Assistant Commissioner acted contrary to law by refusing to comply with the order of his superior authority, the Commissioner (Appeals-II), and by sitting in appeal against the appellate order. The Petitioner sought quashing of the Assistant Commissioner's order dated 12/02/2021 and allowance of the refund claim. Revenue's Contention: The Respondents (Revenue) attempted to justify the impugned order by stating that the department had decided to challenge the Commissioner (Appeals-II)'s order dated 14/10/2019 before the GST Tribunal. They relied on Circular No. 110/29/2019-GST regarding the eligibility for filing refund under the 'Any Other' category.