A Division Bench of the Bombay High Court has recently set aside an order rejecting the Goods and Services Tax (GST) Input Tax Credit (ITC) refund claim of the petitioner-Adisan Laboratories Private Limited for alleged lack of compliance of natural justice of the Department.
The revenue had denied the refund claim of the petitioner owing to the Input Tax Credit accumulated due to inverted duty structure.
After raising the demand for refund, the petitioner-assessee was served with an email directing them to access the issued notice by logging into the GSTN Portal. They could not find any notice in the portal. Subsequently, the petitioner wrote in reply about the same.
However, the Petitioners received the impugned order rejecting the claim of the Petitioners for refund thereafter.
Main contention of the Petitioners is that the Petitioners were not given any opportunity as required under the Rules nor any notice was given to the Petitioners and therefore, the impugned order is bad in law.
It was also contended by Makarand Joshi on behalf of the petitioners that they were in the category where credit is accumulated on the ground of rate of tax on inputs being higher than the rate of output supplies.
The Division Bench of Justice Nitin Ramdar and Justice Gauri Godse refrained from deciding the matter on merits and restored it to the respondents for an adjudication after reasonable chances are given to the petitioner to be heard. The impugned order was also set aside.
The court also directed that, “Considering the fact that the delay has occurred due to above circumstances, further procedure be completed by the Respondents within a period of 8 weeks from the date the order is uploaded.”
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