Section 16 of the IGST Act, 2017 –– Refund —- The petitioner challenged the impugned Order-in- Appeal dated 17.10.2021, whereby the appeal filed by the petitioner against order in Refund Order 16.08.2021 was dismissed. The petitioner submitted that the exports made from its SEZ unit amounts to 'Zero-rated supply' within the meaning of Section 2(23) of the IGST Act and therefore the petitioner was entitled for refund of tax paid on input and input services under Section 16(3)(i) of the Act. The petitioner filed six different refund claims under Section 54(3) for the period April, 2019 onwards, which were rejected, whereas the similar refund claims for the period October, 2017 to March, 2019 were allowed. The court observed that the export by the petitioner from its SEZ is a zero rated supply and refund in terms of Section 16 (3)(a) cannot be denied. The petitioners export specifically falls under such category in proviso to Section 54(2). Proviso to Rule 89(1) is only an exception to Rule 89 (1). There is no bar under Rule 89 (1) for refund of unutilized input tax credit. A very purpose of granting this refund is only to give incentive for exports and to reduce the burden of tax to make the exports more competitive in the international markets. There is no merit in the impugned order passed by the respondent denying the benefit of refund of unutilized input tax credit of zero rated supplies effected by the petitioner.

Held that:- The Hon’ble High Court allowed the petition together with consequential relief to the petitioner.