M/S Captain Polyplast Limited vs. Union Of INDIA

Held

The Court held that the refund claim of the petitioner was not time-barred. The primary reason for this decision was the applicability of Notification No. 13/2022-Central Tax dated 05.07.2022, issued by the Central Government under Section 168A of the CGST Act, 2017. This notification explicitly excluded 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. The Court noted that the learned advocate for the respondents did not dispute this aspect and even produced an email communication confirming the application of this notification to the petitioner's case. Consequently, the Court directed the competent authority of the respondents to process the petitioner's refund claim, treating it as filed within time, and to grant the refund along with statutory interest if the petitioner is found eligible. The entire exercise was to be completed within 12 weeks from the receipt of the order.

Facts

M/s Captain Polyplast Limited (the petitioner) filed a refund application for Rs. 1,02,04,266/- on 23.10.2020, claiming Input Tax Credit accumulated due to an inverted tax structure for the period 01.04.2018 to 31.08.2018. The Deputy Commissioner had initially sanctioned the refund. However, Respondent No. 2, in an appeal filed by the CGST department, set aside the Deputy Commissioner's order on 30.09.2021, holding the refund claim to be time-barred. The authority considered the refund application filed on 23.10.2020 as beyond two years from the relevant date. The petitioner contended that the 'relevant date' was incorrectly interpreted and that subsequent government notifications extending limitation periods due to the COVID-19 pandemic should apply.

Key Issues

1. Whether the refund application filed by the petitioner for the period 01.04.2018 to 31.08.2018 on 23.10.2020 was time-barred under Section 54(3)(ii) of the CGST Act, 2017, considering the 'relevant date' as interpreted by Respondent No. 2. Petitioner's arguments: The petitioner argued that Respondent No. 2 erred in treating the 'relevant date' as the due date for filing monthly returns under Section 39 of the CGST Act, 2017, especially considering that this interpretation was applied retrospectively. They contended that the 'relevant date' at the time of filing was the end of the financial year. Furthermore, the petitioner submitted that the Supreme Court's suo motu orders and subsequent government notifications, specifically Notification dated 05.07.2022 (No. 13/2022-Central Tax), which excluded the period from 01.03.2020 to 28.02.2022 for computing the limitation period for filing refund applications under Section 54, rendered their claim within the permissible time frame. Revenue's arguments: The revenue did not dispute the applicability of Notification dated 05.07.2022. They also produced an email communication confirming the application of the said notification to the petitioner's case.