Important Decision in GST | Bombay HC
The Bombay High Court, in the case of IBM, ruled that the refund of a 10% pre-deposit cannot be withheld for the portion of a GST demand that has been completely dropped by the Appellate Authority, simply because the taxpayer wishes to file a further appeal against the remaining confirmed demand.
Original Demand: was Rs 48.96 Cr, Demand Reduced in Appeal to: Rs 17.50 Cr
Demand Completely Dropped: Rs 31.45 Cr
Associated Pre-deposit: Rs 3.14 Cr The Court ordered the refund of ₹3.14 Cr.
The High Court stated that a refund of the pre-deposit for the portion where proceedings have concluded is a statutory right of the taxpayer.
The Court directed the refund to be processed within 6 weeks.
Key Point: A total refund claim cannot be blocked due to the disputed portion of an appeal.