Shah Brothers And Another vs. Commissioner Of State Tax And Ors

Facts

The petitioners, Shah Brothers and another, filed a writ petition challenging two orders dated March 25, 2021, and August 16, 2021, passed by the respondent GST authority. These orders rejected the petitioners' claim for a refund on the grounds of limitation. The petitioners argued that although their refund claim was filed after the statutory two-year period, it was within the extended period granted by an order of the Hon'ble Supreme Court and followed by various High Courts. The State's counsel, after reviewing the cited decisions, conceded that the matter was covered in favor of the petitioners and suggested remanding the case back to the concerned officer for fresh consideration.

Held

The Court held that the impugned orders dated March 25, 2021, and August 16, 2021, were bad in law and accordingly set them aside. The Court accepted the submission of the State's counsel that the matter was covered in favor of the petitioner by the cited High Court decisions. The Court's reasoning was based on the petitioner's argument that their refund claim was filed within the extended period of limitation, as recognized by the Supreme Court and other High Courts. The ratio decidendi is that refund claims filed within the extended period of limitation, as per Supreme Court orders and followed by High Courts, should not be rejected solely on the ground of exceeding the original statutory period. The Court directed the respondent authority to consider the petitioner's refund application afresh on merits, disregarding the point of limitation, and to pass a reasoned and speaking order within eight weeks from the communication of the order.

Key Issues

1. Whether the impugned orders rejecting the refund claim on the ground of limitation are bad in law, considering the extension of time granted by the Hon'ble Supreme Court and followed by other High Courts? Petitioner's contention: The petitioner argued that the refund claim, though filed after the statutory two-year period, was made within the extended period prescribed by the Hon'ble Supreme Court's order. They relied on decisions from the Bombay High Court (Writ Petition (L) No. 1275 of 2021, Saiher Supply Chain Consulting Pvt. Ltd. Vs. The Union of India & Anr.) and the Madras High Court (W.P. No. 18165 of 2021, M/s. GNC Infra LLP Vs. Assistant Commissioner (Circle), Ekkatuthangal, Commercial Tax Department) to support their claim. Revenue's contention: The learned advocate for the State fairly submitted that the cited decisions covered the present case in favor of the petitioner and that the matter should be remanded back to the officer concerned for fresh consideration on merits.