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IN THE HIGH COURT OF KERALA AT ERNAKULAM
ZIYAD RAHMAN A.A., J
M/S. SALVE MARIA INTERNATIONAL – Appellant
Versus
DEPUTY COMMISSIONER, CENTRAL REFUND PROCESSING FORMATION, SGST DEPARTMENT – Respondent
JUDGMENT
The petitioner, who is engaged in educational consultancy services provided to foreign universities and educational institutions, have approached this Court being aggrieved by Ext.P1 order passed by the respondent rejecting the application submitted by the petitioner seeking refund of the tax, which was erroneously collected from the petitioner. According to the petitioner, the petitioner had paid CGST and SGST, in respect of the services rendered by them, by categorizing it as intermediary services, as that was the stand taken by the Departments. According to the petitioner, in view of the stand taken by the Department, the petitioner was compelled to make said payment, whereas, later it has come out on the basis of the various decisions by the statutory authorities and the constitutional courts that, the services rendered by the petitioner has to be categorized as export services for which no tax is payable under CGST/KGST Act . In such circumstances, the petitioner submitted an application seeking refund on the reason that, the tax was collected from the petitioner under mistaken law.
2. However, as part of processing the said application, Ext.P2 show cause notice was i
A taxpayer has the right to a fair hearing and consideration of objections against limitation for tax refunds due to prior erroneous tax collection.
The limitation period for tax refund applications does not apply if the tax was collected under a mistaken interpretation of law.
The court ruled that the denial of a tax refund on grounds of limitation was wrong, emphasizing the principle of unjust enrichment, and clarified that the time limit of two years for refund applicati....
Voluntary payments made under a mistake are not subject to the limitation period for refund claims under Section 54(1) of the GST Act.
The court established that the limitation period for refund applications under the CGST Act is determined by the original filing date, not subsequent deficiencies.
The court held that a refund application filed within the statutory period cannot be rejected on grounds of limitation, and the applicant must be afforded an opportunity to be heard before any reject....
Limitations for refund claims under the Goods and Services Tax Act can be suspended due to exceptional circumstances such as a pandemic, making rejection solely on delay unsustainable.
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