Facts of the Case

Sanjay Kumar Dhelia filed a writ petition before the Calcutta High Court challenging an order dated 07.02.2022 passed by the respondent GST authority rejecting his refund claim on the ground of limitation. The respondents impleaded included the Union of India and the CGST Authority. Notably, no representative appeared on behalf of the respondent/CGST Authority despite service of notice, and the Court had to engage the advocate who usually appears for the CGST Authority to represent it in the matter.

Issues Involved

  1. Whether the rejection of the petitioner's refund claim solely on the ground of limitation was sustainable in law.
  2. Whether unreported decisions of the Bombay and Madras High Courts, holding similar limitation-based rejections improper, applied to the petitioner's facts.

Petitioner's Arguments

  • The impugned order of rejection on limitation grounds was bad in law.
  • Reliance was placed on an unreported decision of the Bombay High Court dated 10.01.2022 in Writ Petition (L) No.1275 of 2021 (Saiher Supply Chain Consulting Pvt. Ltd. vs Union of India & Anr.).
  • Reliance was also placed on an unreported decision of the Madras High Court dated 28.09.2021 in WP No.18165 of 2021 (M/s. GNC Infra LLP vs Assistant Commissioner (Circle), Ekkatuthangal, Commercial Tax Department).

Respondent's Arguments

  • The learned Additional Solicitor General appearing for the Union of India, upon being asked to consider the decisions relied on by the petitioner, very fairly submitted that on the facts of the present case the decisions were covered in favour of the petitioner.
  • The ASG agreed that the matter should be remanded to the officer concerned to consider the refund claim afresh and pass an order on merits.

Court Order/Findings

  • Considering the submissions of both sides, the Court set aside the impugned order dated 07.02.2022 rejecting the refund claim on limitation.
  • The Court directed the respondent concerned to consider the petitioner's refund application afresh on merits, and pass a reasoned and speaking order in accordance with law instead of on the point of limitation, within eight weeks from communication of the order.

Important Clarification

  • Where the Revenue's own counsel fairly concedes, on being confronted with directly applicable High Court precedent, that a limitation-based refund rejection is not sustainable on similar facts, courts will readily remand the matter for a decision on merits rather than adjudicate the limitation question themselves.
  • Even unreported decisions of coordinate High Courts on the point of GST refund limitation can be relied upon to secure a remand once the Revenue does not seriously contest their applicability.

Sections Involved

  • Section 54, CGST Act, 2017 — refund of tax, including the limitation period for filing refund applications.

Decision – In Favour of

In favour of the Assessee — the refund rejection based on limitation was set aside and the matter remanded for fresh consideration strictly on merits.

Related Case Laws

No related case laws are available on this site at present for cross-reference on this specific point.

Case Details

  • Court: High Court at Calcutta
  • Case No.: WPA No.4378 of 2022
  • Parties: Sanjay Kumar Dhelia vs Union of India & Ors.
  • Coram: Justice Md. Nizamuddin
  • Date of Order: 21.03.2022

Link to Download the Order

Download the full order

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