07-02-2022 – Denial of refund for non-transmission of data from GSTN to ICEGATE is bad in law being beyond the control of assessee; cost imposed on the department

The Hon’ble High Court of Bombay vide its Order dated 12 October 2021 in the matter of SRC Chemicals (P.) Ltd. v. Central Board of Indirect Taxes in Civil Writ Petition No. 5160 of 2021 held that refund should not be denied to the taxpayer on the basis that data was not transmitted from GSTN to ICEGATE, which is beyond the control of the asesseee.

The Petitioner preferred the Writ Petition before the Hon’ble High Court seeking directions to the respondent to refund the amount of IGST of Rs. 22,92,587/- paid by them in respect of goods on 28.06.2017.


  • The Petitioner exported goods on 28.06.2017 from Jawaharlal Nehru Port, Nhava Sheva. The practice prevalent at the said Port is that the shipping bills would get generated and printed at the said port on the basis of documents submitted by the Petitioner.
  • Since it was a time when the indirect tax was going under a complete change and port was also in process of adopting new system for transition to GST regime, the shipping bills could not get printed on the same day, i.e. 28.06.2017.
  • The shipping bill got printed on 01.07.2017 (the day GST was introduced) with the applicable IGST on it and the Petitioners GST Identification number.
  • The export being categorized as “Zero rated supply”, the petitioner chose to pay the amount of Rs. 22,92,587/- being the IGST and seek refund thereof.
  • The Petitioner on not receiving the refund claim till 16.09.2018, approached the custom office to check the status of refund, however, the petitioner was informed that unless the export data is not transmitted from GSTN to ICEGATE, the Custom office would not be in a position to process the refund.
  • Thereafter, the petitioner filed an online refund application in February, 2019 seeking refund on GST Portal when permitted by the respondents, however, a show cause notice was issued to the petitioner for the same and subsequently in adjudication, the refund was rejected by the adjudicating authority.
  • The Petitioner preferred an appeal against the aforesaid adjudication order before the Commissioner (Appeals – II) which was rejected on the ground that ‘the jurisdiction of refund of IGST paid on exported goods is with the Customs department.’
  • The Petitioner kept sending reminders to the respondents and in reply to those reminders, a communication dated 10.02.2020 was received by the petitioner, which was addressed from one of the respondents to another and stated that data of the said shipping bill of the petitioner was not transmitted from GSTN to ICEGATE and thus, his office is unable to process IGST refund.

Petitioner’s Plea

  • The Petitioner submitted that it has no control over the process of printing at the said Port.
  • As per Circular No. 26 of 2017 – Customs dated 01.07.2017, the petitioner was not required to file any separate application for refund of IGST paid on supply of goods for export.
  • Despite the repeated reminders sent to the respondents, no satisfactory reply has been received by it. Moreover, the online application filed by it for refund was also rejected on the ground of jurisdiction.


  • The communication dated 10.02.2020 between the respondents indicates that the Petitioner is entitled for refund but the petitioner made to run from pillar to post only because date of IGST refund is not transmitted from GSTN to ICEGATE.
  • Unfortunately, it has been more than 4½ years since the amount has not been refunded and it was the responsibility of the respondents to grant the refund to the petitioner.

The Hon’ble High Court with the above findings allowed the Writ Petitioner imposing cost of Rs. 25,000/- on the respondents and directing them to pay the amount of refund of Rs. 22,92,587/- within four weeks with interest @ 9% from the date of filing of the Petition.

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