Refund of IGST is mandated when earlier notifications were found unconstitutional, confirming unavailability of time-bar arguments.

JUDGMENT :

BHARGAV D. KARIA, J.

1. Heard learned advocate Mr. Uchit N. Sheth for the petitioner and learned Advocate Ms. Hetvi Sancheti for the respondents.

2. Rule returnable forthwith. Learned Senior Standing Counsel Ms. Hetvi Sancheti for the respondents waives service of notice of rule for the respondents.

3. Having regard to the controversy involved which is in narrow compass, with the consent of the learned advocates for the parties, the matter is taken up for hearing.

4. By filing the present petition under Article 226 of the Constitution of India, the petitioner has challenged order dated 01.05.2025 passed by respondent No.2 rejecting refund of IGST Paid by the petitioner in view of Entry No.1 of Notification No. 10 of 2017 dated 28.06.2017. It is also prayed to direct the respondent authorities to grant refund of the amount of IGST to the tune of Rs.40,30,715/- which was paid by the petitioner in view of aforesaid Notification. It is the case of the petitioner that by virtue of Entry No. 10 of Notification No. 10 of 2017, the petitioner was asked to pay IGST on ocean freight in respect of CIF value by superintendent of Central Tax during visit to premises of the petitioner on 26.12.2018.

5. Brief facts of the case are as under:

5.1 The petitioner, which is a Public Limited Company and registered under the Central Goods and Services Tax Act, 2017 (hereinafter referred to as "GST Act") is engaged in the business of manufacturing, processing, refining, and trading of edible oils, vanaspati, bakery fats, soya food products, and allied commodities. The petitioner imported several consignments of Crude Palm Oil during the year 2018-19 under Cost, Insurance and Freight (CIF) contracts. When the goods are imported by the petitioner Company inside the country, bill of entry for home consumption is filed by the petitioner.

5.2 It is the case of the petitioner that at the time of clearance of the goods for home consumption, the petitioner company pays Customs duty and Integrated Goods and Services Tax on the total value of goods which is the Cost, Insurance and Freight (CIF) value.

5.3 Section 5 (3) of the Integrated Goods and Services Tax (hereinafter referred to as "IGST") empowers the Government to specify the categories of supply of goods or services or both, and the tax on such goods or services shall be paid on reverse charge basis by the recipient of such goods or services. The category of supply of services is mentioned in Entry No.10 of the Reverse Charge Notification.

5.4 Thereafter, the petitioner deposited IGST on ocean freight on Imports for a period 01.04.2018 to 30.11.2018 to the tune of Rs. 40,30,715/- and vide order dated 21.02.2019 contended before the respondent that such deposit has been made under protest as the petitioner is not liable to pay GST on ocean freight relating to the CIF imports.

5.5 It is the case of the petitioner that after the Judgment of this Court in Mohit Minerals vs. Union of India reported in (2020) 74 GSTR 134, which was confirmed by Hon’ble Apex Court in Union of India vs. Mohit Minerals in 2022 10 SCC 700 which held the aforesaid notifications to be ultra vires, the petitioner being eligible for refund of IGST filed application for refund under FORM GST RFD-01 on 18.03.2025 claiming refund of Rs. 40,30,715/-.

5.6 The refund application was duly acknowledged by the jurisdictional authority and acknowledgment in FORm GST RFD-02 was issued on 03.04.2025. Thereafter, respondent No.2 issued show cause notice in FORM GST RFD-08 on 03.04.2025 proposing to reject the refund application of the petitioner on the ground that the application is time-barred under limitation as prescribed under section 54(1) of the GST Act.

5.7 The petitioner vide letter dated 19.04.2025 filed his reply against afor