The Delhi High Court ( HC ) has held that the application for a refund under section 54 of the Central Goods and Services Tax Act, 2017 (CGST) can’t be rejected on the ground of expiry of limitation since the period from 01.03.2020 to 28.02.2022 was excluded.
Megicon Impex Pvt ltd, the petitioner challenged the order dated 24.07.2020 passed by the adjudicating authority and an order dated 27.08.2020, passed by the Appellate Authority [Additional Commissioner of Central Tax (Appeals)], rejecting the petitioner’s appeal against the order dated 24.07.2020.
The petitioner’s application for a refund was rejected on the ground that it was filed beyond the period of two years as stipulated under Section 54(1) of the Central Goods and Services Tax Act, 2017.
The petitioner has filed a refund application for the period of February 2018 on 29.04.2020 for an amount of Rs. 67,35,077/- The earlier application for the same period was for an amount of Rs. 92,65,473/-. Thus, amending the same by reducing it by Rs 25,30,396/-.
The Additional Commissioner of Central Tax (Appeals) rejected the appeal filed by the petitioner and concluded that the impugned order dated 24.07.2020 was passed by the law.
It was contended that as per the notification dated 05.07.2022, whereby the period commencing from 01.03.2020 to 28.02.2022, was directed to be excluded for computing the period of limitation, for filing a refund application under Sections 54 or Section 55 of the Act.
While analysing the said notification, a two-member bench comprising Justice Vibhu Bakhru and Justice Amit Mahajan viewed that the impugned orders cannot be sustained as the benefit of the relaxation in the period of limitation has not been accorded to the petitioner.
The Court directed the respondents o forthwith process the petitioner’s application for a refund under law.
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