Re-credit of GST Refund Claim Rejected through GSTR-3B | Gujarat High Court

I am sharing with you all an important ruling of Gujarat High Court in the case of M/s GARDEN SILK MILLS LTD (R/Special Civil Application No. 7397 of 2018), in which the respondent revenue (proper officer) is directed to re-credit the amount of refund rejected to the Electronic Credit Ledger on the basis of Form GST RFD-PMT 03 or in case no mechanism is available with the proper officer, the petitioner shall be permitted to manually take input tax credit of the amount of the refund rejected in Form GSTR- 3B on suo moto basis.

The facts of the case are that, the petitioner filed refund application and debited electronic credit ledger by the amount of Rs.17,55,13,818/- as refund claimed.

Pursuant to filing of refund claims, there was no concrete response from the proper officer. Constrained by the inaction of the department, petitioner vide letter addressed to the proper officer, inquired the status of refund applications and inter alia stated that the amount of refund claim filed by them were huge and they had also debited the same from the Electronic Credit Ledger, non-passing of the order is adversely affecting their working capital requirements.

Subsequently, by the impugned order, the proper officer rejected the refund claims filed.

The petitioner requested for the finalisation of the refund claims by crediting the Electronic Credit Ledger by the amount of refund claim rejected. Getting, no response from the proper officer, the petitioner filed present writ petition seeking relief for, recrediting the amount of Rs.17,55,13,818/- on the basis of Form GST RFD-PMT 03 issued by the proper officer in their Electronic Credit Ledger at the time of filing of monthly summary return – GSTR 3B (suo moto) or for a direction to the proper officer to grant such recredit immediately in Form GST RFD-01B.

Observation of the Court: The petitioner having given up the challenge (i.e. filing of appeal) to the order rejecting the refund, the respondents revenue (proper officer) are bound to re-credit the amount of refund rejected to the Electronic Credit Ledger by an order made in Form GST PMT-03. 

In case, it is not possible to re-credit the amount to the Electronic Credit Ledger by the respondent revenue due to non-availability of mechanism at GSTN portal, the petitioner shall be permitted to manually take input tax credit of the amount of the refund rejected in Form GSTR-3B.