19.02.2022 – Refund not to be denied or withheld on account of manual filing of refund application under Rule 97A of the CGST Rules, 2017, assessee would also be entitled to interest in case of delay in granting refund beyond the time prescribed under law.

The Hon’ble High Court of Allahabad vide order dated 6 October 2021 in the matter of Savista Gobal Solutions (P.) Ltd.  V.  Union of India in Writ Tax No. – 113 of 2021 held that refund not granted after the sanction order already been passed in view of department’s circular 12/44//2019-GST,  is bad in law .  It is a settled position is law, that Circulars cannot override the effect of law arising from rule 97A of the CGST rules.

The Petitioner preferred the Writ Petition seeking directions to the respondents to release the amount of their refund claim of Rs. – 1,28,50,535/- once the order sanctioning the refund has already been passed and the refund amount became due to the petitioner on 06.01.2020, when the aforesaid sanction order was passed.


  • The Petitioner filed an application manually as per rule 97 A of the CGST rules, seeking refund claim of Rs. 1,28,50,535/- for the month of July, 2019.
  • The refund claim of the petitioner was sanctioned by the respondents vide order dated 06.01.2020, however the same has not been actually remitted to petitioner on the ground that it was filed manually.
  • The respondents withheld the refund claim of the petitioner in view of the department’s Circular – 125/44/2019 – GST dated 18.11.2019 which prescribes for online filing of the applications of refund.
  • The refund claim of the petitioner became due on 06.01.2020 when the sanction order was passed by the respondents however the amount of the refund has not been actually paid to the petitioner till date.

Aggrieved with actions of the respondents the petitioner preferred the present Writ.


  • The Petitioner has rightly filed the application for seeking refund manually as per the Rule 97A of the CGST rules which provides for manual filling of applications.
  • As per section 54(7) of the CGST Act, 2017 the aforesaid refund application should have been processed and necessary order passed within sixty days of the date of the receipt of the application however the order has been passed after the period of 60 days, thus the petitioner is entitled for the interest amount also as per Section 56 of the CGST.

On the other hand it was contended on behalf of the respondents that the refund claim could not be processed and remitted as the application for refund claim was filed manually and not online on GST portal as required.


  • There is no dispute that the amount of Rs. 1,278,50,535/- is refundable to the petitioner by the respondents for the month of July, 2019 and same was not processed and paid by the respondents within 60 days as per Section 54(7) of the CGST Act.
  • The actions and conduct of the respondents is an eyewash and the contentions raised by the respondents would not, in any way, disentitle the petitioner towards refund claim, as well as the interest payable as per Section 56 of the Act.
  • The Circular referred to by the respondents i.e. 125/44/ 2019 – GST, for not remitting the refund amount of the petitioner is for providing directory or an optional mode. Moreover the circular was issued on 18.11.2019 after the date of filing the refund application, hence could not be made applicable to the present case.
  • It is settled law that the delegated legislation would stand on a higher pedestal over a pure administrative instruction, thus the aforesaid Circular cannot override or negate the effect of law arising from Rule 97A of the CGST rules.
  • The respondents have themselves processed the refund application and passed the order date 06.10.2020, sanctioning the refund claim, hence liable to pay interest for non-compliance of the same.

The Hon’ble High Court with the above findings allowed the writ petition and directed the respondents to refund the entire amount of Rs. 1,28,50,535/- with interest from the date of filing the application till the date of payment of the aforesaid refund amount.

**  Similar view was taken by the Hon’ble High Court of Madras in the matter of Twin Disc Power Transmission (P.) Ltd.  Vs.  Deputy Commissioner (ST) – Order dated 16 December, 2021 and by the Hon’ble High Court of Bombay in the matter of Laxmi Organics Industries Ltd.  Vs.  Union of India – Order dated 30 November 2021.

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