Claim of Budgetary Support under GST can’t be rejected as it was made for period prior to Registration: Sikkim High Court grants relief to Glenmark [Read Judgment]

Glenmark - Budgetary Support - GST - registration - Sikkim High Court - Taxscan

In a relief to Glenmark Pharmaceuticals Limited, the Sikkim High Court has held that the Claim of Budgetary Support under GST can not be rejected as it was made for a period prior to the registration.

The writ petitioner, Glenmark Pharmaceuticals Limited is engaged in the manufacture and supply of pharmaceutical products at their unit situated in Sikkim. They seek to challenge four orders passed by the Assistant Commissioner, Central Goods and Service Tax, Gangtok Division, Gangtok rejecting the four claims for budgetary support for four quarters filed by the petitioner.

The dispute in the present writ petition relates to the rejection of the petitioner’s claims for budgetary support under a “Scheme of Budgetary Support under Goods and Service Tax” regime on the ground that the claims were made for the period prior to the registration which is impermissible.

The division bench of Justice Bhaskar Raj Pradhan and Justice Meenakshi Madan Rai noted that although the application for registration and issuance of UID made by the petitioner had been received by the respondent on 12.12.2017, the authority neither registered the petitioner nor rejected the application compelling the petitioner to reapply for the same electronically pursuant to which registration and UID was granted on 31.10.2018. The fact that registration and UID were granted makes it evident that the petitioner was eligible for budgetary support under the scheme.

The bench said that the Respondent failed to process the application for registration as required. Since, the Respondent failed to grant the registration to the petitioner, although it was an eligible unit, the petitioner could not have made their claims for budgetary support before being allotted the UID. When the Respondent registered the petitioner and allotted the UID on 31.10.2018, just two days after, on 02.11.2018, the petitioner made all the four claims for the four quarters.

The court held that the impugned orders are liable to be set aside. It is accordingly ordered. As the respondents have rejected the claims of the petitioner on the technical ground as stated above it is directed that the authorities shall process the four claims made by the petitioner for budgetary support and sanction reimbursements as found eligible within three months from the date of this judgment.

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