Rejection of Refund Application on Grounds of Delay is Unjustified as Refund of Pre-Deposit Is a Vested Right | HC
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- Last Updated on 21 February, 2025
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Case Details: BLA Infrastructure (P.) Ltd. vs. State of Jharkhand - [2025] 171 taxmann.com 187 (Jharkhand)
Judiciary and Counsel Details
- M.S. Ramachandra Rao, CJ. & Deepak Roshan, J.
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Nitin Kumar Pasari, Adv. for the Petitioner.
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Mohan Kr. Dubey, A.C. to A.G for the Respondent.
Facts of the Case
The petitioner, a registered dealer under the GST Act, received a show-cause notice under Section 74 of the JGST Act for a mismatch in GSTR-1 and GSTR-3B. The proper officer passed an order demanding tax, interest, and penalty. The petitioner appealed before the Appellate Authority with a 10% pre-deposit of the disputed tax. The appeal was allowed, and Form GST APL-04 was issued. The petitioner applied for a refund of the pre-deposit under Section 54(1), but it was rejected as time-barred. Aggrieved, the petitioner approached the Jharkhand High Court.
High Court Held
The Hon’ble Jharkhand High Court held that the refund of a statutory pre-deposit is a vested right once an appeal is allowed. Since the pre-deposit is a statutory requirement and not an independent tax liability, its refund cannot be denied based on a directory provision. The Court found that interpreting “may” in Section 54(1) as mandatory would be unreasonable and conflict with the Limitation Act, 1963. Thus, the rejection order was set aside, and the Revenue was directed to process the refund.
List of Cases Reviewed
- Ranjan Shrivastava v. State of Jharkhand & Anr. (2024) 4 SCC 419
- Lenovo India Pvt. Ltd. v. Joint Commissioner of GST, 2023 SCC Online Mad. 7810, relied on.
List of Cases Referred to
- Rakesh Ranjan Shrivastava v. State of Jharkhand & Anr. (2024) 4 SCC 419 (para 20).
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