Procedural Irregularity Committed by Assessee Should Not Come in Legitimate Way of Grant of Export Incentives | HC

Case Details: Shobikaa Impex (P.) Ltd. v. Union of India - [2024] 164 taxmann.com 486 (Madras)

Judiciary and Counsel Details

• C. Saravanan, J.
• S. Durairaj for the Petitioner.
• V. Malaiyendran, Central Govt. Standing Counsel & N. Dilipkumar, Sr. Standing Counsel, for the Respondent.

Facts of the Case

The petitioner is a 100% Export Oriented Unit [EOU] and it had exported goods out of country. The department issued show cause notice for wrongly availing the benefit of refund under Rule 96 of CGST Rules, 2017 seeking to grant refund of input tax credit availed and utilized in discharging IGST on the exported goods.

It filed writ petition against the demand and contended that it had wrongly claimed refund under Rule 96 on the IGST paid on capital goods and inputs utilized for export of goods instead of Rule 89 of the CGST Rules, 2017.

High Court Held

The Honorable High Court noted that the petitioner had wrongly claimed refund under Rule 96 of CGST Rules, 2017. However, the procedural irregularity committed by the petitioner should not come in the legitimate way of grant of export incentives as admittedly exports were made and the refund claims were itself based on the shipping bills.

Therefore, the Court held that the impugned order was to be set aside and the matter was to be remanded to pass fresh order by examining exports made by the petitioner for grant of refund under Rule 89 of the CGST Rules, 2017.

List of Cases Reviewed

• Commissioner of Sales Tax, Uttar Pradesh v. Auriaya Chamber of Commerce, Allahabad, 1986 (3) SCC 50 : 1986 taxmann.com 531/25 ELT 867 (SC) (Para 13) followed

List of Cases Referred to

• Commissioner of Sales Tax, U.P. v. Auriaya Chamber of Commerce 1986 taxmann.com 531/25 ELT 867 (SC) (para 13).