1. By this writ-application under Article 226 of the Constitution of India, the writ-applicant has prayed for the following reliefs:  

“A. This Hon’ble Court may be pleased to issue a writ of certiorari or writ in the nature of certiorari or any other appropriate writ or order quashing and setting aside order dated 17.2.2021 (annexed at Annexure A) to the extent refund claim of the Petitioner has been partially rejected;

B. This Hon’ble Court may be pleased to issue a writ of mandamus or writ in the nature of mandamus or any other appropriate writ or order directing the Respondents to forthwith grant refund of the tax of ₹ 10,41,355 paid on exports made for the month of June 2019 along with statutory interest on such refund;

C. In the alternative this Hon’ble Court may be pleased to issue a writ of mandamus or writ in the nature of mandamus or any other appropriate writ or order directing the Respondents to forthwith grant re-credit of an amount of ₹ 10,41,355 as per order of re-credit dated 17.2.2021;

D. Pending notice, admission and final hearing of this petition, this Hon’ble Court may be pleased to direct the Respondents to forthwith grant refund or re-credit of the amount of tax of ₹ 10,41,355;

E. Ex parte ad interim relief in terms of prayer D may kindly be granted;

F. Such further relief(s) as deemed fit in the facts and circumstances of the case may kindly be granted in the interest of justice for which act of kindness your petitioner shall forever pray.”

2. The facts giving rise to the present writ-application may be summarised as under :

2(1) The writ-applicant is a private limited company engaged in the business of providing information technology consulting and support services. The writ-applicant is registered under the Central/Gujarat Goods and Services Tax Act, 2017 (for short, the ‘GST Acts’).

2(2) The writ-applicant exports services outside the country for which consideration is earned in foreign exchange. The export of the goods and services are ‘zerorated supplies’ as per Section 16 of the IGST Act.

2(3) Section 16 of the IGST Act provides for the following two options to the exporters:

(i) Export without payment of tax against bond or letter of undertaking in which case refund is admissible of unutilized input tax credit.

(ii) Export on payment of tax in which case refund is admissible of tax paid on exports.

2(4) The writ-applicant availed of the first option for the exports made during the period from July 2018 to March 2019. However, for the month of June 2019, the writ- applicant exported services on payment of tax by availing the second option.

2(5) Since the option of export on payment of tax was exercised for the month of June 2019, the writ-applicant paid the tax on such export transactions.

2(6) The writ-applicant filed refund application for the month of June 2019, wherein it was clearly mentioned that the reason for refund was export of services with payment of tax.

2(7) It is the case of the writ-applicant that the concerned authority had conveyed to the writ-applicant that ‘Annexure B’ containing list of input tax credit would also be required to be uploaded in accordance with the circular of the Central Board of Indirect Taxes dated 18.11.2019.

2(8) Although provisional refund of partial amount was granted, yet while processing the final refund, the refund of an amount of ₹ 10,41,355=00 was rejected by the impugned order dated 17.2.2021 stating “Inadmissible (Entry Not Showing in Annexure B)”.

2(9) When the writ-applicant approached the authority regarding the rejection, the writ-applicant was told that while the refund cannot be granted, the writ-applicant would be entitled to the re-credit in the electronic credit ledger of the amount of refund rejected. The writ-applicant was, however, told to give declaration that it would not file appeal against the order rejecting refund.

2(10) The writ-applicant, therefore, gave a declaration that it would not file appeal against the refund rejection order and request was made to grant the re-credit in the electronic credit ledger. Based on such declaration, the authority proceeded to pass the order of re-credit in respect of the refund amount which was rejected.

2(11) The writ-applicant orally followed up with the authorities on number of occasions to grant the re-credit in accordance with the order of the re-credit passed by the authority. However, the authority orally informed that the GST portal was not allowing the re-credit.

2(12) The writ-applicant gave written reminder on 9.2.2022 to either grant refund or grant re-credit in accordance with the order passed by the authority.

3. In such circumstances referred to above, the writ-applicant is here before this Court with the present writ-application.

SUBMISSIONS ON BEHALF OF THE WRIT-APPLICANT :

4. Mr.Uchit Sheth, the learned counsel appearing on behalf of the writ-applicant has made the following submissions :  

(a) The entire issue has arisen because of the error on the part of the adjudicating authority in processing the refund application as if it was a case of export without payment of tax even though the refund application actually was for export with payment of tax. The absence of entry in ‘Annexure B’ has been cited as the sole reason for partial rejection of the refund in the impugned order. However, the requirement of ‘Annexure B’ even as per the circular dated 18.11.2019 is only for the cases of export without payment of tax. Insofar as the export on payment of taxes are concerned, the authority has to only verify whether the goods or services have been exported or not, and whether the tax in respect of which refund is being claimed has been actually paid or not. Such error in processing of the refund has also led to a situation whereby the authority is unable to re-credit the rejected amount in the electronic credit ledger even though an order of re-credit has been passed.

(b) The writ-applicant was not issued any show cause notice nor any opportunity of hearing was given before rejection of the refund, leading to an erroneous order being passed. If the impugned order qua the rejection of the refund is quashed and the matter is remitted back to the adjudicating authority for fresh processing of the refund in accordance with law, then the matter can be resolved since the factum of export of services and payment of tax is as such not in dispute.  

SUBMISSIONS ON BEHALF OF THE RESPONDENTS :

5. Mr.Utkarsh Sharma, the learned AGP appearing on behalf of the respondents, submitted that looking to the facts and circumstances of the case, more particularly, since the learned counsel for the writ-applicant was only praying for remand of the matter to the adjudicating authority, an appropriate order may be passed by this Court.

ANALYSIS :

6. Having regard to the peculiar facts and circumstances of the case, we must accept the submissions of Mr.Sheth and remit the matter to the authority concerned. It appears that even though it was mentioned in the application for refund that it was an application pertaining to exports on payment of tax, the adjudicating authority appears to have adjudicated the application as if it was for refund of unutilized input tax credit pertaining to exports without payment of tax. This has created a situation whereby on one hand the refund has been partially rejected and on the other hand such partially rejected amount is not even being re-credited into the electronic credit ledger of the writ-applicant even though there is an order passed by the authority for re-credit of the rejected amount.

7. It also appears from the documents on record that the order partially rejecting the refund was passed without issuing any show cause notice to the writ-applicant and is also a nonspeaking and cryptic order.  

8. It will, therefore, be in the interest of justice that the impugned order dated 17.2.2021 (annexed at Annexure A), to the extent the refund application of the writ-applicant has been rejected, is quashed and set-aside and the matter is remanded to the adjudicating authority for deciding afresh the refund application of the writ-applicant to the extent the refund has been rejected. The refund which has already been granted to the writ-applicant may not be disturbed.

9. Since Mr.Sharma, the learned AGP has indicated that some procedural issues may again crop up while partly adjudicating the refund application, so as of abundant caution we clarify that the authority, if it so deems fit, may ask the writ-applicant to file a fresh application for the rejected portion of the refund amount which may be considered as a continuation of the original refund application. In other words, even if the authority requires a fresh refund application, the same would be treated as pursuant to the order of remand by this Court and the issue of limitation may not be raised by the authority.

10. With the aforesaid, this writ-application stands disposed of. The entire exercise shall be completed and the order adjudicating the refund claim of the writ-applicant may be passed within a period of four weeks from the date of receipt of order of this Court.