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GST - Section 16(3) of the IGST Act, 2017 - SEZ Supply – Refund under Section 54 of the CGST Act, 2017 r/w Rule 89 of the CGST Rules, 2017 - Rejection of refund on the ground of inordinate delay of more than 45 days in obtaining the endorsements from Authorized Officer – petitioner’s contention that there is no provisions of GST Act which requires the assessee to obtain endorsement from AO within period of 45 days from the date of invoice - whether the petitioner is required to obtain endorsement within 45 days as per Rule 30(4) of SEZ Rules, 2006 – HELD - In terms of Section 16(3)(b) of the IGST Act, 2017 goods can be supplied to SEZ on payment of tax - once the endorsement under Rule 30(4) of SEZ Rules is made, it would be considered that the goods have been exported and the supplier is entitled for refund - once the assessee had paid the tax and the goods have entered SEZ and obtained endorsement to that effect and furnished the same for the purpose of refund, at any cost, refund cannot be denied for any reason whatsoever - The officer processing the refund should be concerned only about the aspect as to whether the goods have reached SEZ zone and whether tax for such entry has been remitted or not - The delay in obtaining the endorsement and producing the same would only result in delay of entertaining the application for refund – If the goods entered into SEZ and endorsement is made after the expiry of 45 days, in such circumstances, if the concerned officer raised a demand under Rule 30(4) of SEZ Rule, and the assessee paid demand of tax, in those cases also, the assessee is entitled to for refund. Therefore, significance of the endorsement is only to ensure that the goods have entered SEZ and also for the purpose of payment of tax or demand against the DTA supplier – Once the goods have entered into SEZ and duty has also been paid by the petitioner, the failure to obtain endorsement within 45 days is not due to fault on the part of the petitioner and it is for the AO to make endorsement in time, for which, the petitioner cannot be found fault with. Hence, the denial of refund claim by citing that endorsement obtained was not within 45 days and therefore, claim is barred by limitation and said findings to such effect are liable to be set aside - the impugned orders are set aside and the respondent is directed to process the petitioner's applications for refund and issue the refund within a period of 30 days – the writ petition is allowed - Denial of refund on the ground of 'Inappropriate Endorsement' by AO - as per SEZ Act or Rules, the AO is not required to make endorsement in any particular manner, since the invoices submitted by the petitioner were endorsed by AO, there is no doubt that the goods were supplied to SEZ units under Section 16 of IGST Act, and the petitioner is entitled for zero-rated tax benefit and delay in obtaining the endorsements, or mistake, if any, in such endorsements are all technical irregularity and so long as the signature is not doubted, the petitioner cannot be penalized for the actions of AO, which is beyond the control of the petitioner and by such means, deprive the petitioner's right to claim benefit under 16 (3) (b) of IGST, instead, the respondent-Department should have assisted the assessee in rectifying the defects, rather than rejecting the petitioner's applications by citing technical reasons - Denial of refund on the ground of 'Endorsement does not state that goods supplied were for authorized operations' – HELD – the provisions of Section 16 of IGST Act does not contemplate that use of goods is for authorized operation and submission of such endorsement as proof and the amendment to Section 16 stipulating the rules for use of goods for authorized operations was made prospectively w.e.f. 01.10.2023 onwards only and since the petitioner made claim with regard to the supply made to SEZ unit prior to 01.10.2023, the respondent cannot insist that that endorsement must state that goods supplied, were for authorized operations, and such other endorsement. Therefore, rejection of the petitioner's claim on the reason that the endorsement does not specifically states that the goods that have been admitted in full was for authorized operations, and it only states that the goods were received in full and that the endorsement is incomplete, is not tenable. Hence, the findings rendered by the respondent with regard to the denial of claim by citing the delay in obtaining endorsement, endorsement is inappropriate, etc., are set aside - Rule 90(2) & (3) of CGST Rules, 2017 - Denial of claim on the ground that the application is barred by limitation - furnishing of supportive documents at the time of personal hearing - Whether the POD at the time of filing applications but at the time of filing personal hearing, would be fatal to the refund claim - HELD - If it is the case of the Department that the petitioner has filed the applications with deficiencies, Department ought to have issued any memo pointing out such deficiency under Rule 90(3), instead the respondent has accepted the petitioner's applications and issued acknowledgment, and therefore, it is not open to the respondent to contend that the supporting documents were filed with a delay - Further, it is noticed that, in respect of the claim made for the month of December, 2019, the petitioner has furnished supportive documents only at the time of filing of personal hearing and the same had been accepted by the Department, while that being so, the Department cannot take a different stand in respect of the claim made for subsequent period, viz., January 2020, by citing that the documents were filed belatedly, and therefore, claim is not acceptable - Rule 90(3) provides an opportunity to the assessee to file fresh refund application after rectification of certain deficiencies pointed out by the Officer concerned. When such being the intention of the Rule, Officer concerned ought to have acted in a manner facilitating the assessee to get his claim for refund. Instead, both the respondents have passed the impugned orders, which are contrary to the provisions of Rule 90 (3) of CGST Rules, 2017 - Whether time limit fixed under Section 54(1) of the CGST Act, 2017 is directory or mandatory in nature – HELD - Reading of the Section 54 (1) of CGST Act would make it clear that the assessee can make the application within two years. The terms used in said Section “may make application before two years from the relevant date in such form and manner as may be prescribed”, which means that the assessee may make application within two years and it is not mandatory that the application has to be made within two years and in appropriate cases, refund application can be made even beyond two years. The time limit fixed under Section 54 (1) is directory in nature and it is not mandatory. Therefore, even if the application is filed beyond the period of two years, the legitimate claim of refund by the assessee cannot be denied in appropriate cases - In the present case, the application was filed within two years and therefore, the question of making claim after two years does not arise even assuming AO made endorsement after two years, the same would in no way debar the claim as barred by limitation
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