At, High Court of Gujarat At Ahmedabad
By, THE HONORABLE JUSTICE: J.B. PARDIWALA AND THE HONORABLE JUSTICE: A.C. RAO
For Petitioner: Hardik P. Modh
1. The Commissioner, Central GST, Ahmedabad in his impugned order has observed as under:
"The primary ground raised by the department is that when the mandate of Section 54(3) of the CGST Act, 2017 clearly states that a registered person may claim refund of any unutilized input tax credit at the end of any tax period, the question of granting refund, especially when there was no balance of unutilized ITC credit, [refer Table A], is not tenable and therefore legally not correct and hence, erroneous. I have no hesitation in stating that the refund in such cases can be sanctioned purely by the mandate of Section 54(3) of the CGST Act, 2017. The respondents submission - that they had only filled up the columns pertaining to details of turnover and net input tax credit in respect of Statement 3A of the GST RFD 01A and the rest of the amounts were auto populated by the system and therefore he cannot be blamed, is again not a tenable. What is not legally permitted as refund cannot be given via any other means, even if it be an error on the GST portal as far as computing refund is concerned. Notwithstanding any grounds raised, I am of the firm belief, that once there was no unutilized ITC lying in the balance in respect of the refunds erroneously granted [refer Table B], it was incumbent on the respondent not to have claimed it in the first place."
2. In a query which was raised by the Assistant Commissioner, Central GST & C.Ex., Division-VI, Ahmedabad-North, with regard to the unutilized input tax credit after the order of refund, the same was responded by the writ applicant stating as under:
"On 19.9.2017, Transitional Cenvat Credit of Rs. 79,89,56,035/- upto 30.6.2017, was Transferred as CGST. Though the Transitional Credit was as per TRAN-1 Form was credited on 19.09.2017, the amount of such credit pertains to opening Balance of CGST as on 1.7.2017. In other words, it was the Closing Balance of ER 1 Return for the amount of June 2017."
3. Before the Commissioner, the following was pointed out:
"On 19.9.2017, Transitional Cenvat Credit of Rs. 79,89,56,035/- upto 30.6.2017, was Transferred as CGST. Though the Transitional Credit was as per TRAN-1 Form was credited on 19.09.2017, the amount of such credit pertains to opening Balance of CGST as on ER 1 Return for the month of June 2017."
4. Prima facie, it appears that the Commissioner has overlooked the issue with regard to Transitional Cenvat Credit of Rs. 79,89,56,035/- which was ava
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iled upto 30.06.2017 and was transferred as CGST. 5. Let Notice be issued to the respondents returnable on 16th October, 2019. 6. In the meantime, there shall be no coercive recovery towards the refund amount. Direct service is permitted.