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December 10, 2022

Once claim for refund is sanctioned department cannot deny interest on the refund

by CA Shivam Jaiswal in GST, Legal Court Judgement

Once claim for refund is sanctioned department cannot deny interest on the refund

Fact and Issue of the case

Mr. Raichandani states that petitioner has received the refund and what remains is the interest to be paid for the belated payment. Ms Thakker states in case, refund amount is sanctioned after the period of 90 days, the interest is payable. Ms Thakker states that refund sanctioning authority has agreed to pay interest and that the time period starts from the date of receipt of entire set of documents for the refund. Respondents are not able to make out the date of receipt of entire set of documents from petitioner. Mr. Raichandani states that the dates of submission of refund application are given in the impugned orders itself. Ms Thakker states that whether the entire set of documents have been submitted is not clear.

Observation of the case

Court is of the view, that is an unacceptable excuse because respondents should have given to petitioner a list of documents not submitted within three months prescribed for granting the refund. The fact that refund itself has been granted, the excuse of non availability of proof of submitting all documents is unjustified. In the circumstances, respondents are directed to grant refund on the basis of the dates mentioned in the impugned order and interest shall be paid within 8 weeks from today

Conclusion

The Court ruled in favour of the taxpayer and directed that GST officials to grant refund on the basis of the dates mentioned in the impugned order and interest shall be paid within 8 weeks from date of the court order.

Rosy-Blue-India-Private-Limited-vs.-Union-of-India-Bombay-High-Court

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