Facts of the Case

The petitioner, SRG Plastic Company, challenged an appellate order dated 09.11.2022/21.11.2022 which rejected its appeal against an order dated 07.03.2022 of the Proper Officer refusing a GST refund claim of Rs. 4,99,880, on the ground that the petitioner had not provided relevant documents and had not appeared before the concerned officer.

Issues Involved

  1. Whether a refund application accompanied by the documents prescribed under Rule 89 of the CGST Rules could still be validly asked to furnish further documents by the Proper Officer, and whether rejection for non-furnishing of such further documents was sustainable.

Petitioner's Arguments

  • The petitioner had filed all documents required under Rule 89 of the CGST Rules and was therefore not obliged to provide any further documents, relying on Circular No. 125/44/2019-GST dated 18.11.2019.

Respondent's Arguments

  • The refund application was rejected because the petitioner had not furnished certain documents sought by the concerned officer and had not appeared before him despite the opportunity given.

Court Order / Findings

  • The Court held that while an application accompanied by all relevant documents prescribed under Rule 89 cannot be rejected as incomplete, this does not preclude the concerned officer from calling for any other document he considers necessary for processing the refund claim; the petitioner's blanket contention that no further documents could be sought was therefore not accepted.
  • Considering that the petitioner had furnished most of the relevant documents, and that a functional Appellate Tribunal would have afforded an opportunity to furnish further documents, the Court set aside the impugned order and remanded the matter to the Proper Officer to adjudicate the refund claim afresh, directing the petitioner to furnish all available documents sought within three weeks, and the Proper Officer to decide expeditiously, preferably within four weeks thereafter.
  • The Court expressly clarified that it had not expressed any view on the merits of the refund claim, which was to be considered independently by the Proper Officer.

Important Clarification

Even where a GST refund application is accompanied by all documents prescribed under Rule 89(2) of the CGST Rules, the Proper Officer retains the power to call for any other document he considers necessary to process the claim; however, rejection of the refund for non-furnishing of such further documents, without affording a further opportunity (particularly where the Appellate Tribunal is not functional), is liable to be set aside and remanded for fresh adjudication.

Sections Involved

  • Rule 89, CGST Rules, 2017 — prescribes the documentary evidence required to accompany a refund application.
  • Circular No. 125/44/2019-GST — clarifies procedure and documentation requirements for GST refund applications.

Decision – In Favour of

Disposed of with directions, in favour of the Assessee procedurally — the rejection was set aside and the matter remanded for fresh adjudication on merits, with no view expressed either way on entitlement to the refund.

Case Details

  • Court: High Court of Delhi at New Delhi
  • Case Number: W.P.(C) 5698/2023
  • CNR / Citation: W.P.(C) 5698/2023 & CM APPL. 22331/2023
  • Coram: Hon'ble Mr. Justice Vibhu Bakhru & Hon'ble Mr. Justice Amit Mahajan
  • Date of Order: 2 May 2023

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