While permitting the refund of Goods and service tax (GST) towards the special economic zone (SEZ) by the Madras High court, it ruled that any individual can furnish for the refund beneath section 54 of the CGST act.
Special economic zone (SEZ) is the applicant and shows the buyings from various suppliers or vendors for the development of SEZ. The applicant seeks the refund of taxes furnished under the Central Goods and Services Tax Act, 2017, State Goods and Services Tax Act, 2017, and Integrated Goods and Services Tax Act, 2017.
The applicant has previously furnished the applications towards the refund of the taxes wrongly remitted through it on several dates to its suppliers. Upon the specific point, a show-cause notice was provided to the applicant stating that the refund was urged upon the basis of section 54 of the CGST Act read with rule 89 of CGST rules also it is to be notified that the supplier of the services will only be subjected to claim the refund and not the SEZ on its own.
Applicant directed that he had done a mistake by remitting the taxes upon the supplies performed to it as the supplies built were zero GST rates supplies which get privileged from the tax. It moreover specified that the reference under section 54 of the CGST act to any individual stated that the reference in Section 54 of the CGST Act to ‘any person’ and will engage SEZ also, it will be subjected to avail of the refund of erroneously remitted tax.
Justice Anitha Sumanth ruled that below the CGST act and state GST acts, the statutory policy for the refund allows any person to request the refund of the taxes incurred on SEZ. Under section 54 of the CGST Act, which provides for the refund, it can be applicable to any individual who avails for the refund and builds an application for permission for that. Hence it was ruled that inside the present concern the applicant will come beneath the term of any individual as enumerated under section 54 of the CGST Act and as per that, it will be subjected to ask for the refund of the taxes furnished through it.
“Thus, on a combined reading of Section 54 and Rule 89, the restriction which has been read into the provision by the Revenue is, in my view, misplaced. In fact, the Officer in the impugned order proceeds on the basis that the second proviso to Rule 89 deploys the word ‘only‘, which I do not find in the second proviso. It is a settled position that there can be no insertion of a word or phrase in a statutory provision or in a Rule which must be read and applied, as framed. No restrictions or amplification of the Rule are permissible by interpretation. On the legal issue of entitlement to refund, I hold in favour of the petitioner, the court said.”
