ORDER :

1. Though W.P. No. 616 of 2020 is not listed today, we have requisitioned the record of the said case, as the subject matter of the said writ petition is identical to that of W.P. No. 527 of 2020 and this order will dispose of both W.P. Nos. 527 and 616 of 2020.

2. Heard Mr. T. Sruyanarayana, learned counsel for the petitioner and Mr. L. Venkateshwar Rao, learned counsel representing Mr. K. Raji Reddy, learned Senior Standing Counsel for the Commercial Tax Department.

3. Issue relates to rejection of claim of refund of the petitioner.

4. Petitioner is engaged in the business of exporting software and information technology services. In connection with the export business of the petitioner, input tax paid on input services and capital goods gets accumulated as unutilized credit in the books of account of the petitioner. As a result, petitioner has been filing refund claims for refund of utilized input tax credit under Section 54(3) of the Telangana State Goods and Services Tax Act, 2017 read with Section 54(3) of the Central Goods and Services Tax Act, 2017 (CGST Act) and Section 20(xiii) of the Integrated Goods and Services Tax Act, 2017 (IGST Act). The two petitions relate to two such claims for the period April, 2018 to June, 2018 and July, 2018 to March, 2019.

5. By the common refund rejection order dated 22.10.2019, respondent rejected such claim for refund on the ground that petitioner had not submitted the required documents in hard copies for verification.

6. Referring to Rule 92(3) of the Central Goods and Services Tax Rules, 2017 (CGST Rules), learned counsel for the petitioner submits that when a claim for refund is made and if the proper officer is satisfied for reasons to be recorded in writing that the claimed refund is not admissible or is not payable, then he is required to issue notice in the prescribed form, in which event, the claimant has to furnish a reply. The proper officer is under an obligation to consider such reply before accepting the claim of refund or rejecting such claim. As per the proviso, no application for refund shall be rejected without giving the applicant an opportunity of being heard. In this connection, learned counsel for the petitioner has placed reliance on a Division Bench decision of the Bombay High Court in BA Continuum India (P) Limited vs. Union of India, (2021) 125 Taxmann.com 180 (Bombay).

7. Despite notice being issued in both the writ petitions on 08.01.2020 and 09.01.2020 respectively, respondent has not filed counter affidavit.

8. Section 54 of the CGST Act deals with refund of tax. Sub-Section (1) says that any person claiming refund of any tax and interest may make an application before the expiry of two years from the relevant date in the prescribed form and manner. As per sub-section (5), if on receipt of any such application, the proper officer is satisfied that the whole or part of the amount claimed as refund is refundable, he may make an order accordingly. In terms of sub-section (7), the proper officer shall issue the order under sub-section (5) within 60 days from the date of receipt of the application, complete in all respects.

9. Chapter X of the CGST Rules deals with refund. Rule 89 forming part of Chapter X provides for filing of application for refund of tax, interest etc. in the prescribed electronic form. Rule 92 which is also part of Chapter X deals with an order sanctioning refund. Sub-Rule (3) of Rule 92 is relevant and the same is extracted hereunder:

“Rule 92 - Order sanctioning refund:

(1) *** *** ***

(2) *** *** ***

(3) Where the proper officer is satisfied, for reasons to be recorded in writing, that the whole or any part of the amount claimed as refund is not admissible or is not payable to the applicant, he shall issue a notice in Form GST RFD-08 to the applicant, requiring him to furnish a reply in FORM GST RFD-09 within a period of fifteen days of the receipt of such notice and after considering the reply, make an order in FORM GST RFD-06 sanctioning