Page 72 - GSTL_23rd April 2020_Vol 35_Part 4

398 GST LAW TIMES [ Vol. 35
against any outstanding demand under the Act or under any existing law
and the balance amount refundable :
Provided that in cases where the amount of refund is completely adjusted
against any outstanding demand under the Act or under any existing law,
an order giving details of the adjustment shall be issued in Part A of Form
GST RFD-07.”
14. Coming to the facts of the present case, we find that admittedly, the
petitioner-Company had discharged their tax liability under the IGST head, but
inadvertently or otherwise, the petitioner deposited the amount under the CGST
head. It is not the case that the petitioner-Company has concealed the transaction
or has committed any fraud in discharging its tax liability. It is a plain case in
which the tax has been paid by the petitioner to the Central Government, but not
under the IGST head, rather under the CGST head. The contention of Learned
Counsel for the CGST is that there was some ulterior motive behind the deposit
of tax under the CGST head, which is evident from the fact that the petitioner
had filed its GSTR-1 in which the tax liability was correctly shown, showing the
supply to be the inter-State supply, but the stand was changed in the form
GSTR-3B. From the letter dated 5-4-2019, issued by the respondent No. 2 as con-
tained in Annexure-6 to the writ application, it is apparent that for discharging
his liability of tax, the petitioner had deposited cash in its electronic cash ledger,
as admitted in the letter itself. Had there been otherwise intention on the part of
the petitioner, the same cash could have been deposited by the petitioner in the
electronic cash ledger used to deposit the tax under the IGST head, but it is the
claim of the petitioner that inadvertently due to the fact that it was the initial
stages of the GST regime, the cash was deposited in the electronic cash ledger of
CGST head. There appears to be substance in the submission of Learned Counsel
for the petitioner, inasmuch as, by deliberately depositing the cash in the elec-
tronic cash ledger for the CGST head, at the place of IGST head, possibly no ben-
efit was going to be derived by the petitioner-Company. In that view of the mat-
ter, we are not in a position to doubt the bona fides of the petitioner-Company,
that due to the initial stage of the CGST regime, there might be some confusion,
and the cash was wrongly deposited in the wrong electronic cash ledger.
15. That being the position, though we find from the plain reading of
Section 49(3) and (4) of the CGST Act, that Learned Counsel for the CGST may be
right in his contention that under Section 49(3) of the CGST Act, the ‘electronic
cash ledger’ may be used for making the payment of the tax and the other liabili-
ties under this Act only, i.e., CGST Act, and there is no provision of cross utiliza-
tion of the fund as in case of ‘electronic credit ledger’ under Section 49(4) of the
CGST Act, but Section 77(1) of the CGST Act, read with Section 19(2) of the IGST
Act, clearly lay down that a registered person who has paid the Central tax, treat-
ing the transaction to be intra-State supply, as in the case of the petitioner, but
which turns out to be inter-State supply, is entitled to the refund of the amount
of tax so paid, under Section 77(1) of the CGST Act, and at the same time such
person cannot be saddled with the liability of interest in view of the provision of
Section 19(2) of the IGST Act. The contention of the Learned Counsel for the
CGST that these provisions are for the persons acting bona fide, may also be ac-
cepted, but there is nothing on the record of this case to show that the petitioner-
Company had not acted bona fidely, particularly in view of the fact that the trans-
action relates to the early stages in which the GST regime had been implemented,
and there might be some confusion prevailing at that initial stage. In that view of
the matter, we do not find any plausible reason whatsoever, to deny the petition-
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