In a case, the applicant submitted a refund application u/s 54(1) of the CGST Act for the tax period August 2022, asking for the refund. Previously, the applicant submitted another refund application, which included the period July 2022 to September 2022, which was sanctioned by the department.
But, because of inadvertence, one export invoice related to August 2022 was omitted from the earlier claim. Afterwards, within the regulatory limitation period of 2 years, the applicant submitted a second GST refund application concerning the omitted invoice.
The claim was rejected via Assistance commissioner as per the fact that a refund application regarding the overlapping period had been submitted and sanctioned earlier, and a second refund application for the intervening period was not maintainable.
The applicant is not satisfied with the rejection order dated 03.04.2025 passed in Form GST RFD-06; the applicant approached the Bombay High Court under Article 226 of the Constitution.
Issue: Whether a second refund application u/s 54(1) of the CGST Act can be maintained for an invoice omitted in a previous refund application for a tax period already covered. This is assuming that the subsequent application is submitted within the prescribed limitation period.
The Bombay High Court held that Section 54(1) of the CGST Act does not levy any restriction or bar against filing more than one refund application for the same tax period, especially where the subsequent claim emerges due to inadvertent omission or mistake.
The Court stated that after the filing of the refund application within the statutory period of limitation, technical liabilities cannot quash a substantive refund claim. It carried that principles similar to res judicata cannot be applied in refund proceedings under the GST regime.
The Court criticised the department’s overly technical strategy and stressed that procedural errors must not override genuine substantive rights. Citing the Gujarat High Court judgment in Shree Renuka Sugars Ltd. v. State of Gujarat, the Court affirmed that valid refund claims that were omitted due to unintentional or arithmetical errors cannot be dismissed solely on technical grounds.
Consequently, the rejection order dated April 3, 2025, was quashed, and the refund application was sent back to the Assistant Commissioner for a fresh evaluation based on its merits in accordance with the law.
| Case Title | Valmet Flow Control Pvt. Ltd. Vs Union of India |
| Case No. | Writ Petition No. 14685 of 2025 |
| For the Petitioners | Mr Ram Heda i/b Priyanka Shukla |
| For the Respondent | Mr Siddharth Chandrashekhar, Ms Niyati Mankad, Priyanka Singh |
| Bombay High Court | Read Order |
