M/S Amn Life PVT LTD vs. Union Of INDIA And Ors

Held

The Court held that the 5th respondent erred in rejecting the refund applications. Regarding the first issue, the Court found that Rule 97A of the Central Goods and Services Tax Rules, 2017, specifically permits manual filing of refund applications, and this rule cannot be overridden by a departmental circular dated 18.11.2019. The Court noted that the Bombay High Court in Laxmi Organic Industries Ltd. vs. Union of India and the Gujarat High Court in M/s Ayana Pharma Ltd. vs. Union of India had also held that Rule 97A prevails over the insistence on electronic filing. Concerning the second issue, the Court referred to Section 54(1) of the CGST Act, 2017, which permits any person to apply for a refund, and Rule 41 dealing with transfer of credit on amalgamation. Therefore, the petitioner's inability to be a registered person during the relevant period did not preclude them from seeking a refund, especially in light of business acquisition and credit transfer. The impugned order was set aside, and the matter was remitted to the 5th respondent for fresh consideration on merits within four weeks. The 5th respondent was also directed to pay costs of Rs. 10,000/- to the petitioner.

Facts

The petitioner, M/s AMN Life Pvt. Ltd., assails an order dated 28.07.2022 passed by the 5th respondent, which declined to consider their applications for GST refund for the financial years 2017-2018, 2018-2019, and 2020-2021. The applications were submitted via email on 30.05.2022. The grounds for rejection included the non-filing of the prescribed RFD-01 form, the petitioner not being registered during the relevant periods, and the requirement for electronic filing of refund applications. The petitioner contended that they acquired a business undertaking in October 2020 and were thus unable to file electronically for earlier periods, necessitating manual submission.

Key Issues

1. Whether the 5th respondent was justified in rejecting the refund applications on the grounds that an RFD-01 form was not filed and that the applications were submitted manually, contrary to Rule 97A of the Central Goods and Services Tax Rules, 2017? 2. Whether the 5th respondent erred in rejecting the refund applications on the basis that the petitioner was not a registered person during the relevant financial years, despite Section 54(1) of the CGST Act, 2017, and Rule 41 of the CGST Rules, 2017, concerning refund applications and transfer of credit? Petitioner's arguments: The petitioner argued that due to their GST registration becoming effective only in October 2020 after acquiring a business, they were unable to file refund applications electronically for the earlier financial years. They relied on Rule 97A of the CGST Rules, 2017, which permits manual filing, and contended that a departmental circular mandating electronic filing could not override this rule. They also argued that Section 54(1) of the CGST Act, 2017, allows any person to apply for a refund, and Rule 41 addresses transfer of credit on business amalgamation, implying their eligibility. Revenue's arguments: The respondents relied on a circular dated 18.11.2019 mandating electronic filing of refund applications and the petitioner's lack of registration during the period for which refunds were sought.