No Right to Find a Deficiency in RFD01 after 15 days- Delhi High Court in Jian International

No right to find a deficiency in RFD01 after 15 days –

No right to find a deficiency in RFD01 after 15 days of filing it. Held by the Honorable Delhi High court in case of Jian International. 

Case Covered-

Jian International

Versus

Commissioner of Delhi Goods And Services Tax 

Facts of the Case-

The present writ petition has been filed seeking a direction to respondent to grant a refund of Rs.9,12,893/- claimed under Section 54 of the Delhi Goods and Services Tax Act, 2017 (hereinafter referred to as ‘DGST Act’) for the month of August 2019 as well as the grant of an interest in accordance with Section 56 of DGST/CGST Act.

Learned counsel for the petitioner states that in accordance with Section 54(6) of DGST Act read with Rule 91(2) of Delhi Goods and Services Tax Rules, 2017 (for short “DGST Rules”) proper officer is required to refund at least 90% percent of the refund claimed on account of zero-rated supply of goods or services or both made by registered persons within a period of seven days from the date of acknowledgment issued under sub-rule (l) or sub-rule (2) of Rule 90 of DGST Rules. He states that despite the period of fifteen days from the date of filing of the refund application having expired on 19th November 2019, the respondent has to date neither pointed out any deficiency/discrepancy in FORM GST RFD-03 nor it has issued any acknowledgment in FORM GST RFD-02.

Observation of Honorable Delhi High Court-

Admittedly, to date, the petitioner’s refund application dated 4th November 2019 has not been processed. As neither any acknowledgment in FORM GST RFD-02 has been issued nor any deficiency memo has been issued in RFD-03 within the timeline of fifteen days, the refund application would be presumed to be complete in all respects in accordance with subrule (2), (3) and (4) of Rule 89 of CGST/DGST Rules. 

To allow the respondent to issue a deficiency memo today would amount to enabling the Respondent to process the refund application beyond the statutory timelines as provided under Rule 90 of the CGST Rules, referred above. This could then also be construed as a rejection of the petitioner’s initial application for refund as the petitioner would thereafter have to file a fresh refund application after rectifying the alleged deficiencies. This would not only delay the petitioner’s right to seek a refund but also impair petitioner’s right to claim interest from the relevant date of filing of the original application for refund as provided under the Rules. 

Moreover, the respondent’s prayer to raise a deficiency memo is a hyper-technical plea as admittedly, all the relevant documents have been annexed with the present writ petition and the respondent is satisfied with their authenticity.

Consequently, this Court is of the view that the respondent has lost the right to point out any deficiency, in the petitioner‟s refund application, at this belated stage.

Accordingly, this Court directs the respondent to pay to the petitioner the refund along with interest in accordance with law within two weeks. 

With the aforesaid directions, the present writ petition stands disposed of. 

The order is uploaded on the website forthwith. Copy of the order is also forwarded to the learned counsel through e-mail.

Read and download the copy of the decision-