Jacobs Solutions India Private Limited v. The Union of India and Ors

ORDER

¶8Held accordingly. Hence, the appeal is allowed."

¶10In our opinion, when the entire fact finding exercise was subjected to the scrutiny in an appeal resulting in the appeal being allowed, then it is difficult to accept the contention as urged on behalf of the respondents that the Assistant Commissioner, who has had no authority and jurisdiction to re-visit the concluded findings of fact and the conclusions as derived by the Additional Commissioner of Appeals. The only remedy for the department and as rightly asserted in the reply affidavit filed on behalf of respondent Nos.1, 3 and 4 if at all was to seek review. If the department was of the opinion that the order passed by the Additional Commissioner needs to be challenged, the same was required to be assailed in the appropriate proceedings as set out in paragraph 11 of the reply PVR 12WP5808-23.DOC affidavit. Thus, from the position as taken by respondent Nos.1, 3 and 4, certainly it was not open to the Assistant Commissioner to pass the impugned order which amounted to sitting in appeal over the order passed by the Additional Commissioner of Appeals. On this ground, the impugned order is required to be held to be passed in patent lack of jurisdiction, as also on the face of it illegal. The Assistant Commissioner could not have passed the impugned order, of the nature he has passed as he was certainly bound by the orders passed by the Additional Commissioner (Appeals), and in the absence of any stay to the orders passed by the Additional Commissioner (Appeals), grants benefit of the orders of the Additional Commissioner (Appeals) dated 11 October 2022 to the petitioner.

¶11Mr.Shah, in our opinion, is correct in placing reliance on the decision of the Division Bench of this Court in Globus Petroadditions Pvt. Ltd. (supra) in which in similar circumstances the Court has observed that the Assistant Commissioner is required to comply with the orders passed by the Commissioner of Appeals and in taking such view the Assistant Commissioner would not have refused to comply with the orders passed by the Commissioner of Appeals. In the present case, at the time when the impugned orders were passed, there are no decision of whatsoever to assail the orders passed by the Additional Commissioner of Appeals in exercising the review power under Section 112(3) of the CGST Act,2017. PVR 12WP5808-23.DOC

¶12In the aforesaid circumstances, the principles of law as laid down by the Supreme Court are well settled. In Union of India Vs. Kamlakshi Finance Corporation Ltd.2 the Supreme had directed the department to adhere to the judicial discipline and give effect to the orders of higher appellate authorities which are binding on them. The relevant observations of the Supreme Court are required to be noted which read thus:- "6. .. .. .. .. .. .. The High Court has, in our view, rightly criticised this conduct of the Assistant Collectors and the harassment to the assessee caused by the failure of these officers to give effect to the orders of authorities higher to them in the appellate hierarchy. It cannot be too vehemently emphasised that it is of utmost importance that, in disposing of the quasi-judicial issues before them, revenue officers are bound by the decisions of the appellate authorities. The order of the Appellate Collector is binding on the Assistant Collectors working within his jurisdiction and the order of the Tribunal is binding upon the Assistant Collectors and the Appellate Collectors who function under the jurisdiction of the Tribunal. The principles of judicial discipline require that the orders of the higher appellate authorities should be followed unreservedly by the subordinate authorities. The mere fact that the order of the appellate authority is not "acceptable" to the department - in itself an objectionable phrase - and is the subject-matter of an appeal can furnish no ground for not following it unless its operation has been suspended by a competent Court. If this healthy rule is not followed, the result will only be undue harassment to assessees and chaos n administration of tax laws. …. … .. .. .

¶8.. .. … .. .. The observations of the High Court should be kept in mind in future and utmost regard should be paid by the adjudicating authorities and the appellate authorities to the requirements of judicial discipline and the need for giving effect to the orders of the higher appellate authorities which are binding on them." 2 1991(55) E.L.T. 433 (S.C.) PVR 12WP5808-23.DOC

¶13In view of the above discussion, we have no manner doubt that the petition needs to succeed. We accordingly allow this petition in terms of prayer clause (a). We direct the respondents to sanction to the petitioner the refund amount of Rs.11,69,07,326/- with appropriate interest in terms of Section 56 of the CGST Act,2017.

¶14The amount be refunded within a period of two weeks from today.

¶15The petition is accordingly disposed of in the above terms. No costs. (JITENDRA JAIN, J.) (G. S. KULKARNI , J.)

PVR 12WP5808-23.DOC IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO. 5808 OF 2023 Jacobs Solutions India Pvt.Ltd. … Petitioner Versus 1. The Union of India 2. The Additional Commissioner of Central Tax. 3. The Commissioner of CGST & CX, Navi Mumbai 4. The Deputy Commissioner of CGST & CX. …Respondents Mr.Prakash Shah with Mr.Suyog Bhave i/b. PDS Legal, for the Petitioner. Mr.Jitendra B. Mishra with Mr.Ashutosh Mishra, for the Respondents _______________________ CORAM: G. S. KULKARNI & JITENDRA JAIN, JJ. DATED: 31 July, 2023 _______________________ Oral Judgment (Per G. S. Kulkarni, J.) 1. Rule. Rule made returnable forthwith. By consent of the parties, heard finally. 2. This petition under Article 226 of the Constitution of India is filed praying for the following reliefs: (a) this Hon'ble Court be pleased to issue a Writ of Certiorari or a writ in the nature of Certiorari or any other writ, order or direction under Article 226 of the Constitution of India calling for the records pertaining to the Petitioner's case and after going into the validity and legality thereof be pleased to quash and set aside the Impugned order dated 27.01.2023 passed by the Respondent No.4 (Exhibit "A"); PRASHANT VILAS RANE Digitally signed by PRASHANT VILAS RANE Date: 2023.08.09 +0530 PVR 12WP5808-23.DOC (b) this Hon'ble Court be pleased to issue a Writ of Mandamus or a writ in the nature of Mandamus or any other appropriate writ, order or direction under Article 226 of the Constitution of India ordering and directing the Respondents to forthwith sanction the refund of Rs.11,69,07,326 as claimed by the Petitioner along with the appropriate interest; (c) pending the hearing and final disposal of this Petition, this Hon'ble Court be pleased to direct the Respondents by an interim order and injunction to forthwith deposit an amount of Rs.11,69,07,326 in this Hon'ble Court with a liberty to the Petitioner to withdraw the same, without prejudice to the Petitioner's right of refund of the actual amount along with appropriate interest; (d) for interim relief in terms of prayer (c) above; and (e) for costs of the Petition; (f) for such further and other reliefs, as this Hon'ble High Court may deem fit and proper in the nature and circumstances of the case." 3. The petitioner is engaged interalia in providing engineering consulting services to its group entities located outside India. During the relevant period, the petitioner exported consulting services to its group entities outside India, without payment of GST thereon. Consequently, the petitioner became eligible to claim refund of the ITC availed on the inputs and input services utilized for the export of the said services. To such effect an application came to be made on 31 December 2021. On 1 February 2022, a show cause notice was issued to the petitioner raising an objection to the petitioner's claim, interalia on the ground of non disclosure of invoice details, etc. The petitioner replied to the said show cause notice by its reply dated 14 February 2022. By an order dated 22 February 2022 passed in Form GST RFD-06, the refund claim as made by the petitioner PVR 12WP5808-23.DOC was rejected, against which an appeal was filed by the petitioner before respondent No.2. By an order dated 11 October 2022, the appeal filed by the petitioner was allowed intreralia holding that the letters issued by the HSBC were sufficient proof of correlation of the invoice number / date with the relevant Bank Realisation Certificates / the FIRCs. 4. In pursuance of the order dated 11 October 2022 passed in an appeal, the petitioner again filed a refund claim on 29 November 2022 as per the procedure. On such refund claim, the Assistant Commissioner of CGST & CX (Central Excise) issued a show cause notice dated 28 December 2022, calling upon the petitioner to show cause as to why the refund claim ought not to be rejected on the ground of non disclosure of invoice details of FIRCs. Su