GST Refund Claim and
Limitation Period: Analysis of M/s. Jouve India Pvt. Ltd. vs. Commissioner of
GST & Central Excise
By Yogesh Verma (CS/LLB) / 2 min read / GST Case Law
Introduction
The taxation system in India has undergone significant
transformation with the introduction of the Goods and Services Tax (GST)
regime. The GST law provides several benefits, including zero-rated taxation on
exports, enabling exporters to claim refunds on the tax paid for exported goods
and services. However, procedural compliance and strict timelines for filing
refund claims often lead to disputes between taxpayers and tax authorities.
One such case is M/s. Jouve India Pvt. Ltd. vs. The
Commissioner of GST & Central Excise (W.P. No. 20805 of 2022, decided on
21.02.2025 by the High Court of Madras), which deals with the denial of a GST
refund claim due to limitation constraints. The case highlights the importance
of considering beneficial government notifications while adjudicating tax
disputes.
This article provides an in-depth analysis of the case,
discussing its background, arguments by both parties, findings of the High
Court, and its impact on taxpayers.
1. Case Background
1.1 Case Title and Details
·
Case Name: M/s. Jouve India Pvt.
Ltd. vs. Commissioner of GST & Central Excise
·
Case Number: W.P. No. 20805 of 2022
·
Court: High Court of Madras
·
Date of Order: 21.02.2025
·
Presiding Judge: Hon’ble Mr. Justice
Abdul Quddhose
·
Petitioner: M/s. Jouve India Pvt.
Ltd., Chennai
·
Respondents:
1.
Commissioner of GST & Central
Excise, Chennai South Commissionerate
2.
Assistant Commissioner of CGST &
Central Excise, Perungudi Division
1.2 Nature of the Dispute
The case revolves around the denial of a refund claim by the
GST department on the grounds that it was filed beyond the prescribed time
limit. However, the petitioner argued that CBIC Notification No.
13/2022-Central Tax, dated 05.07.2022, which excluded the period from
01.03.2020 to 28.02.2022 from limitation computation, should be applied to
their case.
The High Court had to determine whether the refund rejection
was valid in light of the subsequent government notification.
2. Legal Framework for GST Refund
Claims
2.1 GST Refund for Exporters: Under Section 54 of the CGST Act, 2017, a registered
taxpayer can claim a refund of any tax paid under the following circumstances:
·
Exports of goods or services
(zero-rated supplies)
·
Accumulated Input Tax Credit (ITC)
due to an inverted duty structure
·
Excess tax paid due to an error in
tax calculation
The limitation period for filing a refund claim is two years
from the relevant date.
2.2 Impact of COVID-19 and
Limitation Extension: Due to the
COVID-19 pandemic, businesses faced operational difficulties, leading to delays
in tax compliance. Recognizing this, the CBIC issued Notification No.
13/2022-Central Tax (dated 05.07.2022), which excluded the period from
01.03.2020 to 28.02.2022 from the computation of limitation for refund
applications.
This notification played a critical role in the case as the
petitioner’s claim, although initially considered time-barred, became eligible
under the new relaxation.
3. Facts of the Case
·
M/s. Jouve India Pvt. Ltd. exported
goods and services between 01.04.2019 and 25.09.2019.
·
The company filed for a refund of
taxes paid on these exports under Section 54 of the CGST Act.
·
The Assistant Commissioner rejected
the refund claim on the ground that it was filed beyond the two-year limitation
period.
·
The petitioner challenged this order
before the Commissioner (Appeals-II), Chennai, who upheld the rejection in
Order-in-Appeal No. 128/2022 (dated 27.04.2022).
·
The petitioner then approached the
High Court of Madras, arguing that the CBIC’s notification (issued after the
appellate order) should be applied to their case.
4. Arguments by the Parties
4.1 Arguments by the Petitioner
(M/s. Jouve India Pvt. Ltd.):
The petitioner’s counsel, Mr. R. Anish Kumar, made the following submissions:
1.
CBIC’s Notification No. 13/2022
Should Apply – The period from 01.03.2020 to 28.02.2022 should be excluded from
the limitation computation, making the refund claim valid.
2.
Erroneous Rejection by Authorities –
The appellate order (dated 27.04.2022) was passed before the CBIC notification,
and thus, it did not consider the relief granted by the government.
3.
Rightful Entitlement to Refund – As
an exporter of services, the petitioner was entitled to a refund under
zero-rated supply provisions.
4.
Doctrine of Beneficial
Interpretation – Courts have held that beneficial notifications must be applied
retrospectively when they offer relief to taxpayers.
4.2 Arguments by the Respondents
(GST Authorities): The respondents’ counsel, Mr. S.
Gurumoorthy (SPC), conceded that:
1.
The Notification Was Issued After
the Appellate Order – The CBIC notification was issued after the refund claim
was rejected, so it was not considered in the previous order.
2.
Limitation Period Had Been Extended
– The government itself recognized the hardships faced by businesses during
COVID-19, allowing them to file delayed refund claims.
3.
The Case Should Be Reconsidered –
The department was open to reconsidering the refund claim in light of the
notification.
5. Court’s Findings and Judgment: The High Court of Madras made the following key
observations:
1.
CBIC Notification Should Be
Considered – The CBIC Notification No. 13/2022 was a relief measure for
taxpayers, and since it excluded certain periods from limitation, it was
applicable to the petitioner’s case.
2.
Procedural Fairness Is Essential –
The court emphasized that tax authorities should not reject claims on technical
grounds when beneficial notifications exist.
3.
Rejection Was Premature – Since the
appellate authority did not consider the CBIC notification, its order was not
legally sustainable.
Final Order by the High Court: The Order-in-Appeal No. 128/2022 (dated 27.04.2022) was
quashed.
·
The case was remanded to the
Assistant Commissioner, CGST & Central Excise, Perungudi Division, for
fresh consideration.
·
The refund application was to be processed
within 12 weeks.
·
The writ petition was disposed of
without costs.
6. Conclusion and Impact of the
Judgment: The judgment in M/s. Jouve India
Pvt. Ltd. vs. Commissioner of GST & Central Excise is a landmark decision
that reinforces taxpayer rights in refund claims. The case sets a precedent
that:
1.
Tax authorities must consider
subsequent beneficial notifications while adjudicating disputes.
2.
Technical grounds should not override
substantive justice when assessing refund claims.
3.
Government notifications extending
limitation periods apply retrospectively in cases where procedural constraints
were the sole reason for rejection.
This case benefits exporters and businesses seeking refunds
under GST law, ensuring that genuine claims are not dismissed due to procedural
delays.
Disclaimer: All the Information is based on the notification, circular and order issued by the Govt. authority and judgement delivered by the court or the authority information is strictly for educational purposes and on the basis of our best understanding of laws & not binding on anyone.
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