[BREAKING] Wrongful Remittance of GST to Old and New GSTINs by CA: Bombay HC directs Refund of Tax Deposited in Old Registration [Read Order]

Top Stories [BREAKING] Wrongful Remittance of GST to Old and New GSTINs by CA: Bombay HC directs Refund of Tax Deposited in Old Registration [Read Order] “the appellate authority taking a hypertechnical view of the matter, rejected the Petitioner’s appeal”, the Bench noted. By Manu Sharma – On March 27, 2024 12:25 pm – 3 mins read A Division Bench of the Bombay High Court has directed to refund the tax inadvertently deposited by the Chartered Accountant ( CA ) to the Old Goods and Services Tax ( GST ) Identification Number [ GSTIN ] of the petition. The Petitioner contended that he is a script writer who takes up assignments on contract basis.

He had applied for registration under the Central Goods and Services Tax Act, 2017. A Registration Certificate was granted to him on 19th July 2018. The Petitioner had filed his return under the Central Goods and Services Tax Act on 2nd December 2018 and thereafter, no returns were filed. By an order dated 1st January 2019, the said registration of the Petitioner was canceled and hence, was rendered inconsequential. The petitioner had inadvertently filed Goods and Service Tax ( GST ) returns under both his old and new GST registration numbers, leading to the deposit of taxes under both registrations.

Subsequently, he sought a refund for the tax deposited under the canceled old registration number. The case of the Petitioner is that, thereafter, the Petitioner had started his professional activities and made an application for a fresh registration which came to be granted to the Petitioner on 26th March 2022 with a new registration number. It was contended that, for the first quarter of year 2022, two returns came to be filed by his Chartered Accountant who inadvertently, deposited a tax of Rs.1,22,220/- in the canceled registration number – Old GST Account, as also under the new registration number, when in fact, the returns were required to be filed and tax was to be deposited only under the new registration account, which was in vogue and not the canceled registration.

The petitioner’s refund application was initially rejected by the Assistant Commissioner, Central Goods and Services Tax, and Central Excise. This decision was upheld by the appellate authority on grounds of limitation, citing a delay in filing the appeal. On behalf of the Petitioner, it was submitted that this is clearly a case of an inadvertent / bona fide error on the part of the Petitioner’s Chartered Accountant in filing the returns and depositing tax under a canceled registration number and for the second time filing the same return under new registration number.

The counsel C S Lamba therefore submitted that the Petitioner was entitled to seek refund of the tax which was erroneously deposited with the returns filed under the first ( canceled ) registration number. The Bench noted that, “However, it appears that there was an inadvertent / bona fide mistake, on the part of the petitioner’s Chartered Accountant in filing the Petitioner’s return for the first quarter of the year 2022 on both the registrations instead of filing such returns under the new / second registration. Not only this, the returns were identical, also, the tax deposited was of the similar amount of Rs.1,22,220/-”

It was also noted that, “Considering these facts, it was required to be considered by the authorities below that an assessee cannot be expected to file his return and deposit any tax under an invalid canceled registration number.” Upon hearing arguments from both parties, the High Court observed that the tax deposited under the canceled registration was legally non-existent, as the registration itself was invalid. Furthermore, the Bombay High Court Bench of Justice Firdosh P Poonawalla and Justice G S Kulkarni criticized the authorities for a hyper-technical approach in rejecting the appeal on procedural grounds. In result, the court quashed the earlier orders rejecting the refund application. It also directed the refund of the erroneously deposited tax amounting to Rs. 1,22,220/- under the canceled registration number, along with interest within four weeks

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