Facts of the Case:
In this case, the petitioner approached the High Court to seek directions to the GST authorities for issuance of Form GST PMT-03 and restoration of Input Tax Credit (ITC) in its Electronic Credit Ledger (ECL). The dispute arose from refund claims filed by the petitioner for the tax periods August 2017, September 2017, and October 2017 on 19.01.2018 through the common GST portal.
Subsequently, the department issued three separate show cause notices rejecting the refund claims. Instead of filing appeals against the rejection orders, the petitioner requested the department vide letter to re-credit the rejected refund amounts back into its Electronic Credit Ledger. However, the GST portal did not provide any technical functionality for re-crediting ITC in cases where refund claims had been filed under the category “any other” through Form DRC-03.
The petitioner contended that once refund claims were rejected and no appeal was preferred, it became legally entitled to restoration of the ITC originally debited. It was argued that denial of such re-credit merely due to technical limitations of the portal was arbitrary and violative of substantive statutory rights. The petitioner further asserted that ITC constitutes a vested right and its denial amounted to deprivation of property contrary to Article 300A of the Constitution.
The department, while opposing the petition, submitted that the GST portal contained a mechanism for re-credit only in cases where refund applications were filed through the prescribed refund module. According to the department, the petitioner had adopted an irregular route by debiting ITC through Form DRC-03 under the category “any other,” for which no automated re-credit functionality existed on the portal.
Issue:
Whether the GST authorities could deny re-credit of Input Tax Credit to the taxpayer solely on the ground that the GST portal lacked functionality to issue PMT-03 or restore ITC in cases where refund claims filed under “any other category” through Form DRC-03 were rejected.
Held That:
The High Court allowed the writ petition and held that the department itself had conceded the petitioner’s entitlement to re-credit of the rejected refund amount. The Court observed that once the substantive entitlement of the petitioner was undisputed, any procedural or technical lapse whether attributable to the taxpayer or the department, became insignificant.
The Court took note of the department’s own communication acknowledging that the GST portal lacked functionality to re-credit ITC debited through DRC-03 in refund claims filed under the category “any other.” The authorities had themselves admitted that multiple tickets had been raised with GSTN and CBICMITRA but the issue remained unresolved due to technical constraints.
The Court held that technical deficiencies of the GST portal cannot defeat vested statutory rights of taxpayers. Since the petitioner’s entitlement to restoration of ITC was undisputed, the department was obligated to provide relief through alternative means rather than deny the benefit altogether.
Accordingly, the Court directed the respondents to manually re-credit the amount into the petitioner’s Electronic Credit Ledger through manual intervention within a period of eight weeks. The writ petition was therefore allowed.
Case Name:RSWM Ltd. Versus Union of India, Through The Revenue Secretary, Central Board Of Indirect Taxes And Customs, Goods And Service Tax Network, Through Chairman, New Delhi And The Commissioner, CGST, Udaipur Commissionerate And The Assistant / Deputy Commissioner, CGST, Rajasthan dated 16.04.2026
To read the complete judgement 2026 Taxo.online 1006
