Under Sections 54 and 56 of the CGST Act, the Department is legally obligated to process IGST refunds in a time-bound manner and pay interest on delayed refunds, regardless of administrative processes, especially when the delay follows the finality of appellate orders.

JUDGMENT :

G. S. Kulkarni, J.

1. Rule. Rule made returnable forthwith. By consent of the parties, heard finally.

2. This petition under Article 226 of the Constitution of India is filed praying for the following substantive reliefs:-

“(a) to issue Writ of Mandamus or any other appropriate writs, orders or directions under Article 226 of the Constitution of India ordering and directing the Respondent Nos.2 and 3 and their subordinates, servants and agents to forthwith release and refund the IGST amount in relation to zero rated supply/export of the goods covered by Shipping Bills, along with applicable interest till the date of refund, the details whereof is mentioned in Exhibit-A;

(b) to issue Writ of Mandamus or any other appropriate writs, orders or directions under Article 226 of the Constitution of India ordering and directing the Respondent Nos.2 and 3 and their subordinates, servants and agents to forthwith pay interest in terms of Section 54 of CGST Act read with Section 16 of the IGST Act, from the date of filing the Shipping Bills to the date of actual refund, in relation to zero rated supply/export of the goods covered by Shipping Bills, the details whereof is mentioned in Exhibit-A.”

3. The facts lie in a narrow compass:- It is the petitioner’s case that he is carrying business of trading and export of parts and accessories of the motor vehicles and mobile accessories etc. in the name of his proprietary concern Guru Nanak Motor House. During the period between 21 December 2018 to 14 January 2019 the petitioner exported SD Super-Fast Data Sync and Cable and related items under the cover of 30 separate shipping bills. The petitioner contends that he had paid and discharged the amount of IGST at the time of procurement of such goods. All the goods were examined and finally assessed and permitted to be exported.

4. It is the case of the petitioner that he was entitled to receive refund of the IGST amount in terms of Section 54 of the Central Goods and Services Tax Act, 2017 (for short, “CGST Act”). Pursuant to the final assessment of the shipping bills, the same was considered as an application for refund. However, on 22 January 2019, the goods were seized by the Special Intelligence and Investigation Branch (SIIB) under Section 110 of the Customs Act, on the allegation that value was mis-declared, which ultimately led to an adjudication order being passed whereby the valuation as prayed by the petitioner was rejected in terms of the following operative order passed in the Order-in-Original by which the goods were inter alia confiscated. The extract of the said order as quoted in the orders passed by the appellate authority read thus:

“M/s Gurunanak Motor House, Plot No.41, Sector-5 Koperkhairne, Navi Mumbai, Maharashtra-400701 (hereinafter referred to as Appellant) filed an appeal dated 30.06.2020 against the Order in Original no.868/2019-20/ADC/NS-II/CAc/JNCH dated 03.03.2020 passed by the Additional Commissioner of Customs, NS-II JNCH, Nhava Sheva (hereinafter referred to as Respondent) wherein the following was ordered-

a) rejected the declared FOB value of the goods of Rs.8,01,13,.254/- covered in six Shipping Bills under provisions of Rule 8 of the Customs Valuation (Determination of Value of Export Goods) Rule, 2007 and the same to be re-determined as Rs.2,18,40,000/- in terms of rule 6 of CVR, 2007.

b) Rejected the claimed drawback of Rs.8,01,132/- made by the appellant in the six Shipping bills filed for export and the same to be restricted to Rs.2,18,400/- as per re-determined FOB value of Rs.2,18,40,000/- under section 75 of Customs Act, 1962. Further re- determined drawback is to be disbursed to exporter only on receipt of BRC with respect to subject Shipping bill.

c) Rejected the MEIS claimed of Rs.16,02,265/- of Appellant in respect of the six export shipments and the same to be restricted to Rs.4,36,800/-as per re-determined FOB value of Rs.2,18,40,000/-

d) Ordered confiscation of goods covered under the six shipping