GST Update

 Desk of CA. Praveen Sharma – 1016 Series (CAPS) 

UTTARAKHAND HIGH COURT IN THE CASE OF Rungta and Sons, Rungta Industries Compound, Kashipur

The petitioner approached the High Court seeking refund of GST amount of ?10.23 lakh which was deducted at the time of purchase of rejected wheat and paddy seeds from a government corporation in 2017.

The petitioner argued that GST was not applicable on such rejected seeds since they were not sold in unit containers or under any registered brand name. This position was also supported by an advance ruling. Despite this, the corporation deducted GST from the petitioner’s security deposit and did not refund the same.

The corporation admitted that the GST amount was refundable but stated that it had already applied to the tax department for refund and was awaiting the same. The tax department, however, contended that the advance ruling would not automatically apply to the petitioner.

The Court observed that the fundamental fact that GST was not payable was not disputed. Therefore, the authorities cannot retain the amount unjustly.

Accordingly, the Court directed the corporation to file the refund application within two weeks, and upon receipt, the department must process and release the refund promptly. The corporation was further directed to pass on the refunded amount to the petitioner within two weeks.

LINK:CA. Praveen Sharma on Linkedin

Regards
CAPS