Rungta And Sons Rungta Industries Compound vs. Uttarakhand Seeds And Tarai Development Corporation LTD.

Held

The Court disposed of the writ petition with a direction to the Managing Director of Uttarakhand Seeds and Tarai Development Corporation Ltd. to decide on the petitioner's representation dated 20.09.2019 as early as possible, but not later than eight weeks from the date of production of a certified copy of the order. The Court did not explicitly rule on the refundability of GST to the petitioner by the GST authorities or the legality of the deduction by respondent no. 1, as the primary relief granted was a direction for the Managing Director to consider the representation. The issue concerning the refund from GST authorities, as raised by respondent no. 4 based on Section 54(8)(e) of the GST Act, was implicitly not decided on merits due to the procedural disposal of the writ petition.

Facts

The petitioner, a partnership firm dealing in seeds and food grains, purchased rejected wheat from Uttarakhand Seeds and Tarai Development Corporation Ltd. (respondent no. 1) in 2017. Respondent no. 1 allegedly deducted GST amounting to ₹10,23,484/- from the petitioner's security deposit, despite an advance ruling stating that damaged wheat seeds attracted a NIL GST rate. The petitioner claims that despite repeated representations, the Competent Authority in respondent no. 1 has not acted upon the matter or initiated steps for a GST refund. The writ petition seeks directions to correct outward supplies, apply for a refund of excess tax paid, and for GST authorities to refund the wrongly collected GST, along with exemplary compensation.

Key Issues

1. Whether the Court can issue a writ of mandamus directing GST authorities (respondent nos. 4-7) to refund GST wrongly collected by Uttarakhand Seeds and Tarai Development Corporation Ltd. (respondent no. 1) to the petitioner, in light of Section 54(8)(e) of the GST Act and the statutory scheme for refunds? Petitioner's argument: The petitioner seeks a refund of GST wrongly collected and retained by the respondents, including compensation for illegal recovery. Revenue/State's argument (represented by respondent no. 4): The petitioner's prayer for a refund from GST authorities cannot be granted in view of Section 54(8)(e) of the GST Act. The GST can only be refunded to the same dealer from whom it was collected. Therefore, no direction can be issued to the Competent Authority to refund GST to the petitioner as it was deposited by respondent no. 1.