Facts of the Case: In this case, the department alleged that the petitioner failed to submit Bank Realisation Certificates (BRCs)/Foreign Inward Remittance Certificates (FIRCs) correlating invoice-wise/month-wise/year-wise with its reported exports. Instead, the petitioner’s bank statement showed lump-sum INR credits from its foreign branch, which the department claimed did not establish actual export remittances.
The Petitioner contended that it had duly submitted export proofs and remittance documents during audit and refund claims, which had been verified earlier. Refunds of accumulated ITC had already been sanctioned during the audit period. The adjudicating authority rejected its claim without proper reasoning, merely stating that invoices and FIRCs were too numerous to reconcile.
The petitioner thus filed a writ petition before the High Court, alleging violation of principles of natural justice and non-application of mind.
Issue: Whether refund of accumulated ITC on exports can be denied on the ground that FIRCs do not match invoice-wise with each export transaction, despite aggregate remittance being established, and whether the adjudicating authority can reject claims without recording proper reasoning.
Held that: The Court found that the adjudicating authority’s rejection of refund was vague and mechanical, as it failed to consider documents submitted by the petitioner and only stated that reconciliation was not possible due to the large number of invoices/FIRCs.
The Court held that FIRCs need not match invoice by invoice or transaction by transaction. It is sufficient if foreign exchange remittances are received on a cumulative/periodic basis, and the aggregate remittance covers the total export benefit claimed.
Since relevant material was ignored, the order was unsustainable. The impugned order was set aside. The matter was remanded to the adjudicating authority with directions to issue a fresh notice for personal hearing, consider submissions and documents afresh, adjudicate the SCN by a reasoned order.
Case Name: Transformative Learning Solutions Pvt Ltd Versus Commissioner Central Goods And Service Tax Delhi East & Anr. dated 24.09.2025
To read the complete judgement 2025 Taxo.online 2521
