Madras HC Orders Reconsideration of Unprocessed GST Refund Flagged by DGRAM

The Madras High Court remanded the IGST refund case for reconsideration as the refund was not processed because of the alert raised by the Director General of Data Analytics & Risk Management ( DGRAM ).

As per the impugned GST order, the court remarked that the IGST refund claim was that the dealer had not uploaded supporting documents.

Under Section 54 of applicable GST legislation, a GST order rejecting the refund was contested by the taxpayer, Colors of Rainbow before the High Court in the way of the writ petition.

With the IGST payment, the taxpayer exported goods from March 2023 to May 2023 and claimed a refund for the IGST paid. On 07.09.2023 refunds for April and May 2023 were sanctioned, but the March 2023 refund was not.

It was discovered that the March refund was delayed due to an alert from the Director General of Data Analytics & Risk Management ( DGRAM ), the taxpayer reapplied dated 28.05.2023. The impugned order rejected the reapplication.

For the export of goods, the process of refund is automatic and refunds for April and May 2023 were processed and sanctioned. However the claim of refund for March 2023 was incorrectly rejected based on the reason that the documents were not been uploaded, the taxpayer’s counsel furnished. He claimed that all the required documents were available in the portal negating the requirement for the other submissions.

For the department the counsel Mr. C. Harsha Raj appeared and recommended that the cases be reconsidered, considering the documents available in the portal and permitting the applicant to provide any other documents.

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The mere reason stipulated therein for rejecting the refund claim was that the dealer had not uploaded supporting documents, the bench of Justice Senthilkumar Ramamoorthy observed.

As per the taxpayer, the processing of the refund claim is automatic and on the grounds of the documents already available on the portal like shipping bills, invoices, and the like. The bench mentioned that the case needs reconsideration in such matters.

The order was set aside by the High Court and remanded the case for reconsideration. The taxpayer was asked to provide any other documents in support of the process. Consequently, the respondent GST department was directed to pass the orders on the refund application within 2 months.