Delhi HC Dismisses Exporter’s Plea for IGST Refund, Holds Petition Not Maintainable Due to Concealment of Cancelled GST Registration [Read Order]

The Delhi High Court dismissed a writ petition seeking the release of Integrated Goods and Services Tax ( IGST ) refund along with interest and held that the plea was not maintainable due to the concealment of material facts and cancellation of the petitioner’s GST registration.

The petitioner-assessee, Shree Radhe Vallabh Traders, holding a valid Importer Exporter Code (IEC) and GSTIN since 2019, had been engaged in exporting goods to foreign buyers in the UAE and Uganda. It claimed entitlement to an IGST refund of ₹1,19,29,742 based on exports and corresponding shipping bills.

Also Read: Interest on IGST Refund Mandatorily Payable After 60 Days from Due Date: Gujarat HC

However, the petitioner was classified as a “risky exporter” in February 2020 by the CGST Audit-I Commissionerate, Delhi. In response, the petitioner submitted the requisite documents and a reply in May 2020, also seeking the refund of IGST.

Despite these submissions, the refund was not sanctioned, which led the petitioner to file WP (C) 6388/2020.

During the hearing, the department submitted that a show cause notice (SCN) for cancellation of GST registration had been issued to the petitioner, to which no reply was filed, and no personal hearing was attended. The GST registration was cancelled with retrospective effect from 13 July 2018 by order dated 27 February 2023. It was also pointed out that a personal hearing on the refund application was fixed for 22 July 2025, but the petitioner failed to appear.

The department further relied on earlier verification reports and communications showing that the exporter appeared to be non-existent and not bona fide. The physical verification conducted by officers of the CGST Audit-I Commissionerate had revealed that the petitioner was not found at its declared premises, which led to the insertion of an alert on its IEC number for suspension of IGST refund. These findings were recorded in the counter affidavit filed in the previous writ petition.

The Bench comprising Justice Prathiba M. Singh and Justice Shail Jain concluded that the petitioner failed to disclose the fact of cancellation of its GST registration, despite the same having been cancelled in 2023 with retrospective effect from 2018. The Court observed that there was clear concealment of material facts, noting that the petitioner cannot be unaware of the cancellation of its GST registration.

Also Read: Customs cannot Deny IGST Refund to Exporter even if Higher Rate of Duty Drawback was Availed: Madras HC

However, since no refund could be granted when the GST registration itself stood cancelled, the Court held the writ petition to be not maintainable. It accordingly dismissed the petition with costs of ₹25,000 to be deposited with the Delhi High Court Bar Association.

The court clarified that the Petitioner is free to avail of its remedies for restoration of its GST registration and thereafter, for any refunds, in accordance with the law.

The assessee was represented by Akhil Krishan Maggu, while K G Gopalakrishnan, along with Nisha Mohandas, Girish Kumar Kaul, Jayesh Khandelwal, Harpreet Singh, M.R. Sanidhya Sharma, Jai Ahuja and Vanshika Kapoor appeared for the department.

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