Bombay HC quashes state order rejecting GST refund claimed by Colgate

 









The Bombay High Court has set aside an order by the deputy commissioner of state tax against a company as the authority had "rejected the application for refund without recording any reasons".

Colgate Global Business Services Pvt Ltd (part of Colgate Palmolive Group) had approached the deputy commissioner of state tax seeking refund of Rs 4,33,03,066 of the Goods and Services Tax (GST).

However, after it was rejected by the authority on June 15, 2020, Colgate, through lawyers Jitendra Motwani and Rinky Jassuja approached the high court. Colgate argued that the order of the deputy commissioner passed in June 2020 rejecting the application was bound to record reasons in the order.

The bench of Justices RD Dhanuka and SM Modak also opined that the order rejecting the application was in breach of the provisions of the Central Goods and Services Tax (CGST) rules as it did not record the reasons in writing for rejecting the application of refund.

Appearing for the Commissionerate of State Tax, additional government pleader Jyoti Chavan submitted that the deputy commissioner will pass a fresh order in compliance of the rules after giving an opportunity to Colgate to be heard expeditiously.

Looking into the submissions made, the bench quashed and set aside the June 2020 order. Application for refund made by Colgate for the period July 2017 to March 2018 for the sum of Rs 4,33,03,066 was restored to file before the deputy commissioner.

The court asked the company to be present before the authority again on February 2.

The bench also ordered the authority to pass a fresh order "without being influenced by the observations made and the conclusions drawn in the impugned order dated 15th June 2020 and in accordance with law expeditiously and not later than three weeks from the date of granting personal hearing" to the company.

Colgate was given liberty to approach the high court again if an adverse order was passed by the authority. But if the authority does consider the refund then they shall refund the amount due to Colgate within two weeks from the date of passing of such Order, said the high court.

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