Dismissed

M/s. Synergy Measurement Technologies Pvt. Ltd. v. Union of India

Telangana HC20 Jul 2022WP/24508/2022

Case brief

AI extract

What is this about?

Petitioner challenged Circular No. 135/05/2020-GST as ultra vires Section 54(3)(ii) of the CGST Act. Court noted a newer circular clarified refund eligibility under Section 54. Respondents admitted petitioner's eligibility. Court directed respondent to process refund claim within eight weeks and dismissed writ petition without costs.

What did the court decide?

Respondent No. 4 directed to process refund claim and complete exercise within eight weeks.

M/s. Synergy Measurement Technologies Pvt. Ltd. Vs… — GST and Indirect Tax | Telangana HC (2022)

¶1

HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction)

¶2

WEDNESDAY, THE TWENTIETH DAY OF JULY TWO THOUSAND AND TWENTY TWO

¶3

PRESENT

¶4

THE HONOURABLE THE CHIEF JUSTICE UJJAL BHUYAN AND THE HONOURABLE MRS JUSTICE SUREPALLI NANDA

¶5

WRIT PETITION NO: 24s08 OF 2022

¶6

Between:

¶7

A//s. Syqergy [\rleasurement Technologies Pvt. Ltd., 10-2-157, Plot No.41 , Ram Nivas,^'1'' Floor, Road No.2, West lvlarredpally, Secunderabad - 500 026, Telanqana State, lndia, Rep By its Authorized Signatory, Sri- Vincent George, S/o.^-N.C. George, Aged about 66 Years.

¶8

...PET|TIONER

¶9

AND

¶10

Unlon of lndia, Ministry of Law and Justice Through its Secretary, 4th Floor, A-Wing, Shastri Bhawan, New Delhi 1^'10001.

¶11

The State of Telangana, Rep. by its Principal Secretary to Revenue(CT) Dept., Secretariat Building, Hyderabad, Telangana.

¶12

The Appellate Joint Commissioner of State Tax, Punjagutta Division, 5th Floor, C.T. Complex, Nampally, Hyderabad.

¶13

The Assistant Commissioner, (State Tax) Maredpally Circle, Begumpet Division, 6th Floor, Pavani Prestige Buildings, Ameerpet, Hyder,bad.

¶14

...RESPONDENTS

¶15

Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated in the affidavit filed therewith, the High Court may be pleased to issue an appropriate writ, order or direction particularly in the nature of Writ of MANDAMUS declaring para 3.2 of Circular No.1 35/2020-GST dated 3'l -032020 (Annexure-P2) amounting to executive legislation in so far as the disq ualification mentioned therein for being read between lines in Section 54(3)(ii) of CGST Act 2017 as illegal, arbitrary, without authority of law, without jurisdiction and contrary to section 54(3xii) of the CGST Act 2017 and consequenfly to set aside the impugned orders of the 3rd and 4th respondents dated 18-04-2022 in Appeal No. AD360221O40386F affirming the orders of the 4t respondent dated 23-11-2O2O in Ref.MPLYe/36AAKCS395OJ122|02 (Annexure-Pl) and direct the 4th respondent to refund the amount of Rs.28,99,0161 along with interest as provided in section 56.

¶16

il2il

¶17

IA NO: 1 OF 2022

¶18

Petition under Section^{151 cPCprayingthat in the circumstances statedin} the affidavit filed^{in support of the petition,the High court may tre pleased to direct} the 1.t respondent^{to refund 50% of the amountpendingdsposal of the writ} petition.

¶19

Counsel for the^{Petitioner:SRl. M.V.J.K. KUMAR}

¶20

Counsel for the^{Respondent No.1: SRI NAMAVARAPU RAJESHWARA RAO,} ASSISTANT SOLICITOR^GENERAL

¶21

Counsel for the Respondent^{Nos.2to 4: SRI L. VENKATESW\RRAO'} SENIOR S.C. FOR COMMERCIAL^TAX

¶22

The Court made the^{following:ORDER}

¶23

THE HON'BLE THE CHIEF JUSTICE UJJAL BHUYAN AND

¶24

THE HON'BLE MRS JUSTICE SUREPALLI NANDA

¶25

WRIT PETITION No.245O8 of 2022

¶26

ORDER: eer the Han'bte the Chief Justice UJJat Bhuyan)

¶27

Heard Mr. M.V.J.K.Kumar, learned counsel for the petitioner and Mr. L.Venkatesu,ar Rao, Iearned counsel lor rcspondents No.2 to 4.

¶28

By filing this petition under Article 226 of the Constitution of India, petitioner seeks a declaration that para 3.2 of Circular No.135/05/2020-GST, dated 31.03.2020, ol the Central Board of Indirect Taxes and Customs (briefly, 'the Board' hereinafter) is ultra^uires Section 54(3)(ii) of the Central Goods and Services^{Tax Act,} 2Ol7 (brief1y, 'the CGST Act'hereinafter).^{Petitioner further} seeks a direction to rcspondent^No.4 for^refundof Rs.29,89,O 16.00 with interest in^{terms of Section} 54^{of the} CGST Act.

¶29

Notice in this case was issued^{on 08.06.2022.}

¶30

4' ' [r tire hcaring ro,la.r'. fuir. L.ve k,teswara Ra,J. learned counsel for r.cspondents No.2 ro 4 has placecl before us a copy of Circular No.1T3 /05 i2022_GST, clateti

¶31

06 .O7 .2C22, of the Boarcl. As p{jr thc sild c:rrc,-rlar, it tias been clar-ified that in cases where the supptier is making supply ol qoods under a concessiollal nctification and the rate of tax of output suppl.y is less than the rate of tax on input supply (of the same goods) at the same point of time due to sr.rp;-,ly of goods bJ, th. supplier u'der such concessional notification, refund of accurlulated input tax credit or.l accourlt of inverlecl structure as per ciause (ii) of sub-section (3) of Section 54 of the CGST Act r.r.,ou1d be allowed in those cases where accumulation cf input tax credit is on account of rate of ta_x on outrvard supoty being less than the rate of tax on inputs (same goods) at the same point of time, as per some concessional notification issued by the Government providing for iower rate ol_ tax for some specified supplies subject to fulfilment of other conditions. As per the said circurar para 3.2 of the circurar No.135/05/2020-cST, dated 31.03.2020, has been substituted in the following m€rnner:_

¶32

I I

¶33

"3.2 It mag^{be noted that refund' of acanmulated} (tC in terms of clause^(it) of Jirst^{prouiso to sub'section(3)} of section 54^{of the CGS?Act is auailoble tuhere the credit} has aca)mulotecl on^{account of rote of tox on inputs being} higher than^{the rate of tox on outputsupplies' /t is} noteLuorth1^{tLnt, the input and output being the same in} such cases,^{tllough ottracting differenttax ratesdt} different^{points in time' do not get coueredunder the} prouisions of clause^{(ii) of the} frst^{prouiso to sub-section} (3) of section 54 of^{the CGST Act'}

¶34

\ I I

¶35

3.3 There^{may houeuer,be casesuhere though} inputs and output^{goodsare somebut the output supplies} are mad.e under^{a concessionalnotiftcation due to uthich} tl-Le rate of^{tax on output suppliesis less than the rote of} tax on inputs.^{In suchcases,as the rate of tax of output} supptg is less^{than the rate of tax on inputs at the same} point of ttme due^{to supptg of goods bg the supplier under} such concessio^{nal notification, the creditocanmtlatedon} account of^{the same is admissiblefor refund under the} prouisions of clause^{(ii) of the} first^{proui'soto sub-section} (3) of section 54^{of the CGST Act, other than th'e cases} uhere output^{supplY is either Nil ratedor fullg exempted'} and. also^{prouided that supplA of such goods or seruices} are not nottfied^{bA the Gouemm'entfor theirexclusion} from^{refun-d of acanmulatedIIC undertLrc said clause'"}

¶36

In view of the^{aforesaid development,lea-rnedcounsel} for respondents^{No'2 to 4 submits, on the basis of written} instructions,^{that petitioner wouldbe etigible for refund}

¶37

¶38

ald therefore, the case of the^{petitionerfor refund rvould}

¶39

be processed

¶40

Having regard to the above, respondent^{No.4 is} directed to process the claim of refund^{of the petitioner in} terms of Section 54 of the CGST Act. The said^exercise

¶41

shall be completed within a^{period of eight weeksfrom the} date of receipt of a copy of this order.

¶42