M/S Jindal Steel And Power LTD. vs. Union Of INDIA

Facts

The petitioner, M/s Jindal Steel And Power Ltd., filed a writ petition before the High Court of Chhattisgarh challenging the delay and denial of its cess refund claims. The petitioner contended that the revenue authorities repeatedly issued deficiency memos (dated 18.06.2021, 03.09.2021, and 07.04.2022) without properly addressing the petitioner's detailed replies and representations (filed on 29.07.2021, 07.03.2022, and 28.03.2022). The petitioner sought directions to quash the deficiency memos, declare CBIC Circular No.110/29/2019 inapplicable, and expedite the adjudication of its refund applications for July 2017 to October 2021. The petitioner's primary grievance, as presented to the court, was the lack of a decision on its responses and representations.

Held

The Court disposed of the writ petition by directing the respondent authorities to consider and decide the reply filed by the petitioner to the deficiency memos (Annexures P-7, P-11 & P-15) and also to consider and decide the representation made by the petitioner (Annexure P-13 dated 28.03.2022). The decision is to be made in accordance with the law, at the earliest, preferably within 45 days from the receipt of the order. The respondents are expected to pass a speaking order, addressing the contentions and submissions made by the petitioner in the deficiency memos and the representation. The petitioner is at liberty to provide necessary information to the respondents. The Court did not explicitly decide on the applicability or validity of CBIC Circular No.110/29/2019 or the merits of the refund claims themselves, focusing instead on directing the adjudication of the pending responses and representations. The ratio decidendi is that authorities must address taxpayer submissions and representations in a timely and reasoned manner, adhering to statutory provisions and principles of natural justice.

Key Issues

1. Whether CBIC Circular No.110/29/2019 dated 03.10.2019 is factually inapplicable to the petitioner's case and if the respondents erred in applying paragraph 3 of the circular to delay/deny cess refund claims? (Question of law) 2. Whether CBIC Circular No.110/29/2019 dated 03.10.2019 is ultra vires the provisions of Section 54 of the CGST Act and liable to be quashed? (Question of law) 3. Whether the three deficiency memos issued by Respondent No. 2 were issued arbitrarily, delaying/denying the refund claim without considering its merits and genuineness? (Question of mixed law and fact) 4. Whether the respondents have failed to consider and expeditiously adjudicate the additional refund applications filed by the petitioner for the period July 2017 to October 2021? (Question of mixed law and fact) Petitioner's Arguments: The petitioner argued that the respondents have repeatedly issued deficiency memos without addressing the petitioner's detailed replies and representations. They contended that the refund claims are legitimate and should be processed after providing an opportunity for a personal hearing and following due process. They also argued that the inaction of the respondents in processing refunds, due to their own failure to issue requisite forms and illegal restrictions on the GST portal, is violative of the statute and principles of natural justice. Respondents' Arguments: Learned counsel for respondents 2 to 4 did not object to the limited relief sought by the petitioner (i.e., direction to decide the reply and representation) but submitted that it would be dealt with strictly in accordance with the Act and Rules.