Facts of the Case

The petitioner, Radhe Associates, filed a Special Civil Application before the Gujarat High Court challenging the order dated 25.11.2021, whereby the GST authorities rejected its refund application under Section 54 of the CGST Act, 2017 on the ground that the refund claim had been filed beyond the prescribed limitation period.

During the hearing, both parties agreed that the Central Government had issued Notification No. 13/2022-Central Tax dated 05.07.2022 under Section 168A of the CGST Act, which excluded the period from 01.03.2020 to 28.02.2022 while computing the limitation period for filing refund applications. Consequently, the petitioner contended that its refund application fell within the permissible time limit.

Issues Involved

  1. Whether the petitioner's GST refund application under Section 54 of the CGST Act, 2017 was barred by limitation.
  2. Whether the exclusion of the COVID-19 period under Notification No. 13/2022-Central Tax applied to the petitioner's refund application.
  3. Whether the GST authorities were justified in rejecting the refund claim as time-barred.

Petitioner's Arguments

The petitioner submitted that:

  • The refund application had initially been rejected solely on the ground of limitation.
  • Notification No. 13/2022-Central Tax specifically excluded the period from 01.03.2020 to 28.02.2022 for calculating the limitation period for filing refund applications under Section 54.
  • Once the excluded period was considered, the refund application was well within the prescribed time limit.
  • Therefore, the rejection order deserved to be quashed, and the refund claim should be processed in accordance with law.

Respondent's Arguments

The respondents acknowledged before the Court that, in view of Notification No. 13/2022-Central Tax, the period from 01.03.2020 to 28.02.2022 stood excluded while calculating the limitation period for refund applications. The respondents did not dispute the applicability of the notification to the petitioner's case.

Court Order / Findings

The Gujarat High Court observed that Clause (iii) of Notification No. 13/2022-Central Tax expressly excludes the period from 01.03.2020 to 28.02.2022 for computing the limitation period for filing refund applications under Sections 54 and 55 of the CGST Act.

Since the respondents themselves accepted the applicability of the notification, the Court held that the petitioner's refund application could not be treated as time-barred.

Accordingly, the Court directed the competent GST authority to:

  • Treat the refund application as filed within the prescribed limitation period.
  • Process the refund claim in accordance with law.
  • Grant the refund along with statutory interest, if otherwise admissible.
  • Complete the entire exercise within 12 weeks from receipt of the Court's order.

Important Clarification

This judgment clarifies that:

  • The benefit of Notification No. 13/2022-Central Tax extends to GST refund applications filed under Section 54.
  • The period from 01.03.2020 to 28.02.2022 must be excluded while calculating the limitation period for refund claims.
  • Refund applications cannot be rejected merely on limitation grounds if they become timely after applying the statutory exclusion.
  • GST authorities are required to process such refund claims on merits instead of rejecting them as time-barred.

Sections Involved

  • Section 54 of the Central Goods and Services Tax Act, 2017 – Refund of Tax
  • Section 168A of the Central Goods and Services Tax Act, 2017 – Power to Extend Time Limit in Special Circumstances
  • Notification No. 13/2022-Central Tax dated 05.07.2022
  • Section 20 of the IGST Act, 2017
  • Section 21 of the UTGST Act, 2017

Link to Download the Order

https://www.mytaxexpert.co.in/uploads/1785143637_2079compressed.pdf

Disclaimer

This content is shared strictly for general information and knowledge purposes only. Readers should independently verify the information from reliable sources. It is not intended to provide legal, professional, or advisory guidance. The author and the organisation disclaim all liability arising from the use of this content. The material has been prepared with the assistance of AI tools.