Wrong Tax Head Entry Not Ground for Denying CGST Refund: Allahabad HC Rejects Appellate Authority’s Technical Approach [Read Order]

The Allahabad High Court has held that a refund claim for Central GST ( CGST ) cannot be rejected merely because the amount was entered under the wrong tax head in the refund form.

The Court observed that such a technical error, even if caused by a software glitch or typographical mistake, does not justify denying a substantive right when entitlement to the refund is undisputed.

“Citation of a wrong provision or typographical error in the forms submitted along with the application cannot be the basis for rejecting the substantive claims of the petitioner or denying rights accruing to the petitioner” said the court.

Bharat Mint & Aroma Chemicals, which had filed a refund application for ₹12.84 lakh CGST. Although the application correctly sought a CGST refund, the amount was inadvertently entered under the Integrated GST (IGST) head in Form GSTRFD-01.

The appellate authority upheld the rejection of the claim, reasoning that it was filed under the wrong head and that no supporting evidence was produced, citing Section 77(1) of the CGST Act.

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Justice Ajay Bhanot, hearing the matter, noted that the cause of the error whether a software glitch or human oversight was irrelevant. What mattered was that the petitioner was admittedly entitled to the CGST refund.

The Court criticised the appellate authority for focusing on a procedural irregularity rather than examining the merits of the claim. It stated that mentioning a wrong provision or making a typographical error in a refund form cannot be the basis for rejecting a legitimate claim.

On the second ground that the petitioner had failed to adduce evidence, the Court found the finding to be in violation of natural justice, as this issue was never raised in the show cause notice. It said that passing an adverse order without prior notice or opportunity to respond was impermissible.

The court, after quashing the orders dated 29 December 2023 and 3 December 2024, remanded the matter to the appellate authority for fresh adjudication on merits in accordance with law.

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