Delhi High Court directs GST authorities to release refunds or pay refund with interest

The Delhi High Court has directed GST authorities to act promptly while pointing out errors in claimed refunds. They will have two weeks to point out a deficiency in a refund application failing which they will need to release refunds along with interest. A petitioner had approached the Delhi High Court after a deficiency in the refund application was pointed out far too late by GST officials. As per CGST Rules, GST authorities are required to refund at least 90% of the refund claimed on zero-rated supplies made by registered persons within 7 days from the date of acknowledgement. However, GST authorities failed to clear the funds even after a 15 day period and didn't point out any discrepancy in FORM GST RFD-03 nor did they issue any acknowledgement in FORM GST RFD-02. The Delhi HC stated that Rule 90 states that within 15 days from the date of filing of the refund application, the respondent has to either point out discrepancy/deficiency in FORM GST RFD-03 or acknowledge the refund application in FORM GST RFD-02. The HC ordered GST authorities to pay the petitioner the refund along with interest in accordance with law within two weeks.

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