The Calcutta High Court in the case of TARINIKA & ORS. vs. COMMISSIONER OF CENTRAL GOODS & SERVICES TAX, HOWARH CGST AND CX COMMISSIONERATE & ANR, vide Case No. WPA 1578 of 2025 dated 18.06.2025 dated 18.06.2025, held that in terms of Rule 90(3), the proper officer is statutorily required to electronically communicate the deficiencies through the common portal within 15 days. Mere backend uploading of RFD-03 without visibility to the taxpayer does not amount to valid service or communication. The Petitioner’s inability to view the reasons on the portal creates a communication gap, and thus cannot be penalized. Procedural fairness under Rule 90(3) is mandatory and essential for enforcement of refund rights under Section 54 of the CGST Act.
Facts of the Case: In this case, the petitioner filed GST refund applications in Form RFD-01 for multiple tax periods ranging from February 2020 to March 2023. The petitioner submitted that as per Rule 90(3) of the CGST/WBGST Rules, 2017, if there are deficiencies in a refund application, the proper officer must issue a deficiency memo in Form RFD-03 within 15 days through the common portal.
It was contended that though deficiency memos were uploaded on the GST portal, they were not able to view or download any details, as no specific reason or document explaining the deficiencies was accessible to them.
The Department claimed that the deficiency was due to “improper data in annexures which could not be verified from ICEGATE” but this reason was not electronically visible to the petitioner.
The petitioners argued they were unable to cure the defects or refile because no valid deficiency was ever communicated.
Issue: Whether refund applications under Section 54 of the CGST/WBGST Act can be deemed defective where no effective deficiency memo has been communicated via the common portal, and whether such applicants can be denied the opportunity to refile.
Held that: The High Court stated that Section 54(1) gives a taxpayer the right to claim refund within 2 years. Further, Rule 90(3) requires that deficiencies be communicated through the common portal electronically in Form RFD-03. The limitation period is suspended between filing of RFD-01 and issuance of a valid RFD-03 under Rule 90(3).
The Court held that merely uploading a blank or inaccessible RFD-03 on the officer’s side does not amount to “communication” of deficiencies to the taxpayer.
There is a communication gap between the officer’s view and taxpayer’s view on the portal—thus the deficiency memo was not effectively served. Hence, the petitioner’s right to refile under Rule 90(3) remains intact.
The Court permitted re-filing of the refund application, treating the date of this order as the date of valid deficiency communication. The respondents were also directed to take up the portal-related issue with the appropriate authority.
To read the complete judgment 2025 Taxo.online 1324
