IGST Refund Claim: Order Within Two Months, “Risky Exporter” Status to be Reviewed
Summary in Key Points:
- Issue: Was the delay in processing the assessee’s IGST refund claim justified?
- Facts: The assessee’s IGST refund claim on exports, pending since June 2022 due to their classification as a “risky exporter,” had not been processed. Neither a regular refund within 60 days nor a provisional refund of 90% under Section 54(6) had been granted.
- Decision: The court directed the proper officer to decide the refund application within two months, after giving the assessee an opportunity to be heard. The assessee was also permitted to separately apply to the competent authority for removal from the “risky exporter” list. This application was also to be decided after granting a hearing opportunity.
Important Note: This decision highlights the importance of timely processing of refund claims. The court’s direction to decide the refund application within a specific timeframe underscores the right of the assessee to a prompt decision. Furthermore, allowing the assessee to challenge their “risky exporter” status separately ensures that this classification, which is blocking the refund, is also subject to review and due process. This dual approach aims to resolve both the immediate issue of the pending refund and the underlying cause of the delay.
HIGH COURT OF KERALA
Majeed Kunnapallil Jabir
v.
Superintendent, Central GST and Central Excise
Gopinath P., J.
WP(C) NO. 27880 OF 2024
OCTOBER 7, 2024
Tomson T. Emmanuel, Adv. for the Petitioner. Suvin R. Menon, CGC, P.R. Sreejith, Jasmine M.M., GP and V. Girishkumar, SC, Advs. for the Respondent.
JUDGMENT
1. The claim of the petitioner for refund of IGST paid on exports (Ext.P3) has been pending since the year 2022. It is the case of the petitioner that going by the provisions of Section 54 of the CGST Act read with the provisions of Rule 96 of the CGST Rules, the claim for refund is to be processed within a period of 60 days. It is submitted that the shipping bill itself is deemed to be the application for refund. It is submitted that the petitioner has been wrongly classified as a ‘risky exporter’ and a decision has been withheld on his application for refund.
2. The learned Standing Counsel appearing for the respondents would submit that Ext.P10 circular issued by the Central Board of Indirect Taxes and Customs would indicate that in the case of a person who has been classified as a ‘risky exporter’, the provisions of Rule 96(5A) of the CGST Rules contemplate the procedure to be followed before sanctioning of refund. It is submitted that the proper officer has to take a decision on the matter and such decision can be taken within a time to be specified by this Court, after affording an opportunity of hearing to the petitioner.
3. The learned counsel appearing for the petitioner would submit in reply that even a provisional refund of 90% as contemplated by the provisions of Section 54(6) of the CGST Act has not been granted to the petitioner.
4. Having heard the learned counsel for the petitioner and the learned Standing Counsel and having regard to the facts and circumstances of the case, I am of the view that since the refund application of the petitioner is deemed to be pending from the date of filing of the shipping bill i.e. June 2022 (on account of the fact that the petitioner has been classified as a ‘risky exporter’), the proper officer is required to take a decision in the matter, after affording an opportunity of hearing to the petitioner.
Accordingly, this writ petition will stand disposed of directing the 2nd respondent or other competent authority to take a decision on the application submitted by the petitioner for refund, in accordance with the law and after affording an opportunity of hearing to the petitioner within a period of two months from the date of receipt of a certified copy of this judgment. It will also be open to the petitioner to move the competent authority for removing the name of the petitioner from the list of ‘risky exporters’. If such application is made or is pending, the competent authority shall take a decision on that application also, after affording an opportunity of hearing to the petitioner without further delay.