The petitioner is entitled to claim refund of the excess balance in its electronic cash ledger, which includes the amount that has been collected by the ECO under Section 52 of the CGST Act.
Section 54 of the CGST Act, 2017 — Refund – The petitioner challenged the Order-in- Appeal dt.29.12.2020, whereby the respondent had set aside the order passed, denying the refund of excess amount lying to the credit of electronic cash ledger of the petitioner. The petitioner contended that due to maintenance of huge inventory on account of purchases affected to meet the forecasted demand, the petitioner invariably has excess balance of ITC in its electronic credit ledger and therefore, the amount retained by the ECO and deposited with the Government under Section 52 , as tax collected at source and reflected in petitioner’s electronic cash ledger remains unutilized; that the said unutilized balance in the petitioner’s electronic cash ledger can be claimed as refund under Section 54 of the Act. The petitioner further submitted that the CBIC, vide Circular No.125/44/2019/GST, dt.18.11.2019, has clarified that refund of excess balance in electronic cash ledger arising on account of TCS can be claimed under the category of ‘refund of excess balance in electronic cash ledger’. The appellate authority held that there is no provision under Section 54(1) for refund of TCS under deposited Section 52 and the Circular dt.18.11.2019 allows refund of TCS – TDS, only when the same has been erroneously deposited in excess, under wrong head. The court observed that the CBIC in the form of FAQs on TCS under GST issued on 20.09.2018 had by way of answer to Question No.24 also permitted the actual supplier to claim refund of excess balance lying in his electronic cash ledger in accordance with the provisions contained under Section 54(1) of the Act. Thus, there is no doubt as to the entitlement of the petitioner to claim refund of the excess balance in its electronic cash ledger.
Held that:- The Hon’ble High Court set aside the Order-in-Appeal and held that the petitioner is entitled for refund of the balance in electronic cash ledger as claimed in Form CGST RFD-01A, dt.20.05.2019.
The petitioner is entitled to claim refund of the excess balance in its electronic cash ledger, which includes the amount that has been collected by the ECO under Section 52 of the CGST Act.
Section 54 of the CGST Act, 2017 — Refund – The petitioner challenged the Order-in- Appeal dt.29.12.2020, whereby the respondent had set aside the order passed, denying the refund of excess amount lying to the credit of electronic cash ledger of the petitioner. The petitioner contended that due to maintenance of huge inventory on account of purchases affected to meet the forecasted demand, the petitioner invariably has excess balance of ITC in its electronic credit ledger and therefore, the amount retained by the ECO and deposited with the Government under Section 52 , as tax collected at source and reflected in petitioner’s electronic cash ledger remains unutilized; that the said unutilized balance in the petitioner’s electronic cash ledger can be claimed as refund under Section 54 of the Act. The petitioner further submitted that the CBIC, vide Circular No.125/44/2019/GST, dt.18.11.2019, has clarified that refund of excess balance in electronic cash ledger arising on account of TCS can be claimed under the category of ‘refund of excess balance in electronic cash ledger’. The appellate authority held that there is no provision under Section 54(1) for refund of TCS under deposited Section 52 and the Circular dt.18.11.2019 allows refund of TCS – TDS, only when the same has been erroneously deposited in excess, under wrong head. The court observed that the CBIC in the form of FAQs on TCS under GST issued on 20.09.2018 had by way of answer to Question No.24 also permitted the actual supplier to claim refund of excess balance lying in his electronic cash ledger in accordance with the provisions contained under Section 54(1) of the Act. Thus, there is no doubt as to the entitlement of the petitioner to claim refund of the excess balance in its electronic cash ledger.
Held that:- The Hon’ble High Court set aside the Order-in-Appeal and held that the petitioner is entitled for refund of the balance in electronic cash ledger as claimed in Form CGST RFD-01A, dt.20.05.2019.