Order Date – 06 November 2023

Parties: M/s. Lenovo (India) Pvt. Ltd. Vs The Joint Commissioner of GST (Appeals-1), The Assistant Commissioner of GST and Central Excise, The Central Board of Indirect Taxes and Customs, Union of India

Facts –

• The Petitioner, M/s. Lenovo (India) Pvt. Ltd., is engaged in manufacture/import of Computers (Desktops/Laptops etc.) and supplying the said goods and related services to units in Special Economic Zones.
• Since the exports and supply of goods or services or both to SEZ units/developers are considered as zero-rated supplies as per Section16, the petitioner filed refund of IGST paid for the months of December, 2019, January 2020 and February 2020.
• The refund have been rejected in part by means of the Order-in-Original on the ground of inordinate delay in obtaining Endorsement, delay in submitting supporting documents and mismatch of documents.

Issue –

• Whether the rejection of refund is proper and valid?

Order –

• The Single Bench of Hon’ble High Court observed that in terms of Section 16 (3)(b), goods can be supplied on payment of tax. Rule 30 (4) of SEZ Rules deals with issue of endorsement by the AO to ensure that the goods have been admitted in full into the SEZ and to treat the same as proof of export. Once the endorsement is made, it would be considered that the goods have been exported. In any event, any duty has been paid in terms of Section 16 (3) (b) of the Act, the assessee would be entitled for refund.
• Since the petitioner has paid IGST but there was delay in obtaining the endorsement. Thus, once the assessee had paid the tax and the goods have entered SEZ and obtained endorsement to that effect and furnished the same for the purpose of refund, at any cost, refund cannot be denied for any reason whatsoever.
• Hence, the denial of refund claim by citing that endorsement obtained was not within 45 days and therefore, claim is barred by limitation and said findings to such effect are liable to be set aside since the failure of obtaining endorsement in time is only due to the fault of AO and the petitioner cannot be denied the claim on the ground of inordinate delay in obtaining endorsement.
• When the petitioner has filed application, which is within a period of limitation, viz. 2 years as stipulated under Section 54(1) of the CGST Act, the delay in filing the supporting document at the time of filing of reply/personal herein would only extend the time limit to pass an order under Section 54 (7) of the CGST Act and non-submission of documents at the time of filing application for refund cannot be deemed to have filed with a delay, since there had been a delay in obtaining the endorsement owing to Covid-19.
• That apart, in terms of notification issued by Central Tax dated 05.07.2022, vide No.13/2022, which excludes the period from 01.03.2020 to 28.02.2022 for computation of period of limitation for the purpose of filing refund application under Section 54 of the CGST Act. Thus, the petitioner's claim cannot be rejected on the ground of limitation.
• So far as the rejection of the claim on the ground of mismatch of details is concerned, since said defect was rectified by the petitioner at the time of filing of reply on 28.01.2022 and the petitioner also furnished revised Statement-4, and the same is also accepted by the learned Senior Standing Counsel for the respondent-Department, findings rendered by the respondent-Department on the ground of mismatch are also liable to be eschewed.
• Accordingly, the Writ Petitions are allowed, the impugned orders are set aside. The respondent is directed to process the refund.