A two-judge bench of the Supreme Court has upheld the decision of the Gujarat High Court where the High Court directed the Goods and Service Tax Authorities to immediately sanction refund towards IGST paid in respect to goods exported made via shipping bills.
Earlier, the claim of the petitioners was rejected by the department rejected under Section 54 of the Central Goods and Service Tax Act, 2017 read with Section16 of the Integrated Goods and Service Tax Act, 2017 on the ground that they claimed higher duty drawback. Aggrieved, the petitioners approached the High Court to sanction the refund of Integrated Goods and Service Tax (IGST) paid in respect of the goods exported i.e. ‘Zero Rated Supplies’ vide the shipping Bill.
As provided in Rule96 of the CGST Rules, 2017, the shipping bill filed by an exporter of goods shall be deemed to be an application for refund of the Integrated Tax paid on the goods exported out of India and such application shall be deemed to have been filed only when the person in charge of conveyance carrying the export goods duly files an export manifest or an export report covering the number and the date of shipping bills or bills of export and the applicant has furnished a valid return in the Form – GSTR3 or Form GSTR3B.
The division bench of the High Court while allowing the refunds said that if the refund of the principal amount is not sanctioned and actually paid to the writ applicant within the period of six weeks from the date of the receipt of this order, then interest would start accumulating at the rate of 9% and the amount shall be paid.
Upholding the High Court order, Justice D Y Chandrachud and Justice M R Shah held that “there is a clear finding of fact which has been recorded by the Division Bench of the High Court of Gujarat in its order dated 15 December 2020 that the respondent had claimed an IGST export refund only to the extent of the customs component. We see no error in the finding of the High Court.”
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