The Hon’ble HC, Gujarat in the matter of Bharat Oman Refineries Ltd. v. Union of India & 1 other(s) [R/Special Civil Application No. 8881 of 2020 dated August 18, 2020] allowed the Petition for refund of tax paid on ocean freight, directing the Respondents to grant refund of the amount of Integrated Goods and Services Tax (“IGST”) paid under the Integrated Goods and Services Tax Act, 2017 (“IGST Act, 2017”) by the Petitioner pursuant to Entry No. 10 of Notification No.10/2017-IGST (Rate) dated July 28, 2017 (“RCM Notification”) declared to be ultra vires along with appropriate interest on such refund.
Facts:
Bharat Oman Refineries Ltd. (“the Petitioner”) filed a writ petition before the Hon’ble Gujarat High Court challenging applicability of GST on Ocean Freight and to grant refund of the amount of IGST already paid by the petitioner pursuant to Entry No. 10 of RCM Notification along with appropriate interest on such refund.
Issue:
Whether the Petitioner can be granted interim relief from the payment of IGST and refund of the IGST paid on Ocean Freight?
Held:
The Hon’ble Gujarat High Court in R/Special Civil Application No. 8881 of 2020 dated August 18, 2020 held as under:
- The RCM Notification was a subject matter of challenge in a batch of writ applications, the lead matter being the Mohit Minerals (P.) Ltd. v. Union of India [Special Civil Application No.726 of 2018 dated January 23, 2020]. This Court in Mohit Minerals and allied petitions declared the Notification No. 8/2017-Integrated Tax (Rate) dated June 28, 2017 and Entry No. 10 of the RCM Notification as ultra vires the IGST Act, 2017 on the ground that the same lacked legislative competency.
- Therefore, the Court directed the Respondents to sanction the refund and refund the requisite amount of IGST already paid by the Petitioner pursuant to the Entry No. 10 of RCM Notification declared to be ultra vires by this Court.
- Further, stated that the Respondents shall undertake the process of refunding the requisite amount of IGST at the earliest and see to it that the same is paid to the Petitioner within a period of six weeks from the date of receipt of this order.