M/S Captain Polyplast Limited vs. Union Of INDIA

Held

The Court held that the refund application filed by the petitioner was within the time limit prescribed, considering the exclusion of the period from 1st March 2020 to 28th February 2022 for the computation of the period of limitation for filing refund applications under Section 54 of the CGST Act, 2017, as per Notification No. 13/2022-Central Tax dated 05.07.2022. The Court noted that the respondents' learned advocate did not dispute the applicability of this notification. The reasoning was that the notification, issued under Section 168A of the CGST Act, 2017, explicitly provides for the exclusion of this period. Consequently, the refund claim, filed on 09.10.2020, was deemed to be within the permissible time frame. The Court directed the competent authority of the respondents to process the refund claim in accordance with law, treating it as within time, and to grant the refund with statutory interest if the petitioners are found eligible. The exercise was to be completed within 12 weeks from the receipt of the order.

Facts

The petitioners, M/s Captain Polyplast Limited and another, filed a writ petition challenging an order dated 30.09.2021 passed by Respondent No. 2. This order allowed an appeal by the CGST department and set aside a previous order dated 14.10.2020 by the Deputy Commissioner, which had sanctioned a refund of Rs. 31,32,544/-. The refund was claimed under Section 54(3)(ii) of the CGST Act, 2017, for Input Tax Credit accumulated due to an inverted tax structure for the tax period 01.02.2018 to 31.03.2018. The refund application was filed on 09.10.2020. Respondent No. 2 held the refund claim to be time-barred, considering it filed beyond two years from the relevant date.

Key Issues

1. Whether the refund application filed by the petitioner for the period 01.02.2018 to 31.03.2018 on 09.10.2020 was time-barred, considering the relevant date as the due date for filing the return under Section 39 of the CGST Act, 2017, as interpreted by Respondent No. 2. Petitioner's contention: The petitioner argued that Respondent No. 2 erred in considering the due date of filing the monthly return under Section 39 as the 'relevant date' for the purpose of limitation, especially with effect from 01.02.2019, and treating this as retrospective. The petitioner further contended that the Supreme Court's suo motu order dated 23.03.2020 and subsequent orders, along with the Central Government's Notification dated 05.07.2022 (amending Notification dated 03.04.2022), excluded the period from 15.03.2020 to 28.02.2022 (plus 90 days) from the limitation period for filing refund applications under Section 54 of the CGST Act, 2017. Therefore, their refund claim, filed on 09.10.2020, fell within this excluded period. Revenue's contention: The respondents did not dispute the application of Notification No. 13/2022-Central Tax dated 05.07.2022, which excludes the period from 1st March 2020 to 28th February 2022 for computing the period of limitation for filing refund applications under Section 54 of the CGST Act, 2017. They confirmed through an email communication that the notification applied to the petitioner's case.