KEDIA AGRO vs Principal Commissioner Hyderabad GST Commissionerate, Assistant Commissioner of Central Tax, Office of the Chief Commissioner of GST and Customs Hyderabad Zone

1

GSTAT

State Bench Hyderabad
Court No. Court I
APL/194/HYD/2026
KEDIA AGRO .............Appellant
Versus
PRINCIPAL COMMISSIONER HYDERABAD GST
COMMISSIONERATE, PRINICIPAL COMMISSIONER,
HYDERABAD GST COMMISSIONERATE & ORS. .............Respondent

Quorum
Hon’ble Sushil Kumar Sharma, Member(Judicial)
Hon’ble Duvvuri Krishna Srinivas, Member (Technical)
Counsel for Appellant
ARPAN BOHRA

Counsel for Respondent
SHRI GOURI SHANKAR
SHRI BENU GOPAL
Form GST APL-04A
[See rules 113(1) & 115]
Summary of the order and demand after issue of order by the GST Appellate Tribunal
whether remand order : No
Order reference no. : ZN360361026000382H Date of Hearing: 28/09/2026
Date of order : 27/10/2026
1. GSTIN/Temporary ID/UIN - 36BKSPK4661G1ZR
2. Appeal Case Reference no. - APL/194/HYD/2026 Date - 23/04/2026
3. Name of the appellant - KEDIA AGRO , [email protected] , 9381876242
Name of the respondant -
4.
1. Office of the Chief Commissioner of GST and Customs Hyderabad Zone ,
[email protected] , 9849247893

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2. Principal Commissioner Hyderabad GST Commissionerate
3. Assistant Commissioner of Central Tax
5. Order appealed against - AD3608230058119

(5.1) Order Type - Refund Order
(5.2) Ref Number - ZD3610240051046 Date - 05/10/2024
6. Personal Hearing - 27/10/2026 28/09/2026 16/09/2026 07/09/2026 16/07/2026
7. Status of Order under Appeal - Reject - Order under Appeal is annulled
Order in brief - The appeal filed by the Appellant is allowed and the impugned orders
passed by the Original Adjudicating Authority (OAA) and the First Appellate
Authority are hereby set-aside. The OAA is directed to reconsider and decide the
Appellant’s refund claim afresh which was rejected earlier, in accordance with law.
8.
Summary of Order
9. If demand order then whether demand quantified: Yes
Section-I
Particulars Central tax State/UT tax Integrated tax Cess Total
Disputed

Amount
Determined
Amount
Disputed
Amount
Determined
Amount
Disputed
Amount
Determined
Amount
Disputed
Amount
Determined
Amount
Disputed
Amount
Determined
Amount
1
2 3 4 5 6 7 8 9 10 11
(a) Tax 0 0 0 0 0 0 0 0 0 0
(b)
0 0 0 0 0 0 0 0 0 0
Interest
(c) Penalty 0 0 0 0 0 0 0 0 0 0

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0 0 0 0 0 0 0 0 0 0
(d) Fees

(e) Others 0 0 0 0 0
0 0 0 0 0
(f) Refund
10. For Other orders and Demand orders which are not quantified:
Issues as raised
by proper
officer
Order by GST
Appellate
Tribunal
Issues as determined by Appellate/Revisional authority
Rejection upheld holding that refund is inadmissible
where application is filed post 18.07.2022 in terms of
Notification No. 09/2022 and Circular No. 181/13/2022-
GST.
Erroneous
refund


ORDER
FINAL ORDER 23/COURT-1/HYD/2026

Per Sushil Kumar Sharma, Member (Judicial)
1. The present appeal has been preferred by M/s Kedia Agro (Proprietor Harish Kedia)
hereinafter referred to as “the Appellant” against order in appeal No. 55/2023/HYD-
GST- JC, dated 28.03.2024 passed by the Joint Commissioner of Central Tax and
GST (Appeals-1) Hyderabad, (hereinafter referred to as “First Appellate Authority”
or “FAA”) where the FAA upheld the order passed by the Assistant Commissioner,
Mehdipatnam GST Division (hereinafter referred to as “original adjudicating
authority” or “OAA”)
The OAA rejected the appellant’s refund application for an amount of
Rs.61,47,671/- claimed under category of accumulated Input Tax Credit (ITC)
arising on account of an inverted tax structure for the period from 01.05.2020 to

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31.03.2021 vide Refund Rejection order in form GST RFD-06 dated 23.05.2023
passed by the Assistant Commissioner, Mehdipatnam, Hyderabad.
Aggrieved by the order of the First Appellate Authority, the appellant has preferred
the present appeal before this tribunal under Section 112 (3) (4) of the Central
Goods and Services Tax Act, 2017 (hereinafter referred to as “the CGST Act”).
Brief facts of the case:
2.0 The brief facts of the case, as submitted by the appellant before the OAA are as
follows:
(i) M/s Kedia Agro, Proprietorship of Shri Harish Kedia (hereinafter referred to
as “the appellant”) is engaged in the business of manufacturing oils falling
under HSN codes 15079010, 15119010 and 15159040, stated in the records.
(ii) It is the case of the appellant that it had filed a refund application of
Rs.61,47,671/- under the category of accumulated Input Tax Credit (ITC)
arising out on account of inverted tax structure, pertaining to the period from
May, 2020 to March, 2021. The appellant stated that it procures raw materials
and other inputs on some of which the rate of GST is higher rate of duty than
the rate applicable to its outward supplies. Consequently, ITC accumulates in
its electronic credit ledger on account of inverted tax structure. The appellant
takes ITC on its inward supplies and discharges GST liability of its outward
supplies.
(iii) It is further stated that the appellant has filed a refund application in form
RFD-01 on 18.06.2022, claiming a refund of Rs.65,04,986/- for the period
from 01.05.2020 to 31.03.2021. An acknowledgement in Form GST RFD-
02 was issued on 30.06.2022 in respect of said application. Subsequently, the
appellant withdrew the said refund application. Thereafter, the appellant filed
a second refund application in Form GST RFD-01 on 25.03.2023 claiming a
refund of Rs. 61,47,671/- for the same refund period i.e. 01.05.2020 to
31.03.2021. The acknowledgement in Form GST RFD-02 in respect of
second application was issued on 06.04.2023.
(iv) The appellant further stated that it had furnished all the requisite documents
alongwith the refund application. However, the OAA rejected the refund

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application by relying upon notification No. 9/2022-CT, dated 13.07.2022 and
CBIC circular No. 181/13/2022-GST dated 10.11.2022.
(v) Authorities took the view that the refund application had been filed after
18.07.2022 and was therefore, liable to be dealt with in the light of aforesaid
notification and circular.
(vi) The appellant has further stated that present refund application pertains to the
period from May, 2020 to March, 2021 and that the relevant GSTR-3B return
for May 2020 was furnished on 26.06.2020. Accordingly, claims that the
refund application was filed within the prescribed limit of two years under
Section 54 of the CGST Act, 2017 read with Rule 89 of the CGST Act, 2017.
(vii) The appellant has submitted that all the requisite documents in support of the
refund claim were furnished before the OAA. However, the adjudicating
authority issued a Show Cause Notice in form GST RFD-08 dated 04.05.2023
for which the appellant submitted its reply in form GST RFD -09 on
19.05.2023.
(viii) Accordingly, vide OIO dated 23.05.2023, OAA rejected the appellant’s refund
claim amounting to Rs. 61, 47,671/- upholding that the claim was not
admissible under the applicable provisions of Section 54 of the CGST Act,
2017 read with Rule 92(3) of the CGST Act, 2017 on the grounds recorded in
the said order.
(ix) Aggrieved by the rejection of its refund claim, the appellant preferred an
appeal before the First Appellate Authority. However, the FAA vide
impugned order upheld the order passed by the OAA and rejected the
appellant’s claim for refund. Being aggrieved by the said order, the applicant
has preferred present appeal before this Tribunal.
Reply of the Respondent:
3.0
(i) The respondent department filed its cross objections on 27.08.2026. The
respondent in its reply, admitted factual averments contained in paragraphs 1
to 3 of the appeal in so far as they related to matters borne out by the record
and the impugned order as well as factual averments contained in paragraph
4. The remaining averments are not admitted. Respondents submitted that

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the appellant had initially filed refund application bearing ARN No.
AA360622023069E, dated 18.06.2022 claiming a refund of Rs. 65,04,986/-
for the period from May,2020 to March, 2021. However, the said application
was withdrawn by the Appellant on 25.07.2022. Thereafter the appellant filed
a fresh refund application bearing ARN No. AA360323036979U Dated
25.03.2023 claiming a refund of Rs.61,47,671/-.
(ii) Accordingly, the refund application under consideration was filed before the
adjudicating authority after 18.06.2022. Respondent further submitted that
the notification No. 09/2022/Central Tax (Rate), dated 03.07.2022 issued
under the First proviso to Section 54(3) of the CGST Act, 2017 came into
force w.e.f. 18.07.2022 and was prospective in nature.
(iii) However, according to the respondent, the fact that the notification operates
prospectively, does not render the restriction prescribed therein inapplicable
to the refund applications filed on or after 18.07.2022. In present case, since
the refund application under consideration was filed on 25.03.2023, the
restriction imposed by the aforesaid notification was applicable to the
appellant’s claim irrespective of the claim that the ITC had accumulated
during the earlier tax period.
(iv) The respondent further stated in cross-objection that that this position has also
been clarified by the CBIC vide circular No. 181/13/2022-GST, dated
10.11.2022. Accordingly, the respondent prayed that the appellant claim for
refund was subject to the restrictions imposed by the aforesaid notification
and that the impugned order rejecting the refund claim did not warrant
interference by this tribunal.
(v) In response to the grounds raised by the appellant in the appeal, the respondent
further submitted that the refund claim is required to be considered in
accordance with the statutory provisions applicable to the refund application
actually filed and adjudicated in the present case. The refund application
under consideration was filed on 25.03.2023, whereas the original refund
application dated 18.06.2022 had already been withdrawn by the applicant on
25.07.2022. The respondent submitted that the CBIC circular was issued to
clarify the applicable legal position and to ensure uniform implementation of

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the refund provisions. The appellant’s contention that it had a absolute vested
right to claim the refund was not admitted, as the refund under section 54(3)
of the CGST Act, 2017, is subject to the conditions and restrictions prescribed
under the Act, and the notification issued thereunder.
(vi) The respondent further stated in cross-objection that refund application on
which the claim was adjudicated had been filed after the relevant restriction
came into force.
(vii) Respondent also stated in cross-objection that Section 54 of the CGST Act,
2017, prescribes the limitation period for filing the refund application, but
does not, by itself confer an unconditional right to refund, irrespective of the
restrictions imposed under Section 54(3) of the said Act. It was further, stated
that once the original refund application had been withdrawn, the subsequent
application was required to be treated as a fresh application. Subsequently,
the applicant could not claim the benefit of the final date of an earlier
application that had already been withdrawn.
(viii) On this basis, the respondent maintained that the findings recorded by the
original adjudicating authority on this issue were correct and justified.
(ix) The respondent further stated in cross-objection that the original adjudicating
authority had duly considered the applicability of notification No. 9/2022-
Central Tax (Rate) dated 13.07.2022 CBIC Circular NO. 181/13/2022-CGST,
dated 10.11.2022 and the effect of the withdrawal of the earlier refund
application. The first appellate authority also had examined the matter and
upheld the findings of the original adjudicating authority.
(x) The respondent stated that the allegation of non-application of mind was not
sustainable. The respondent also stated that a review petition had been
proposed or filed before the Hon’ble Supreme Court in the matter and that the
departmental decision concerning filing of the review petition was still
pending consideration by the Board.
(xi) In view of the foregoing para-wise reply - the respondent prayed that the
present appeal be dismissed and that uphold the refund rejection order dated
23.05.2023 and impugned Order In Appeal dated 28.03.2024 be upheld.

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Reply of the Appellant to the Cross-Objections (Rejoinder)
4.0 The appellant filed a rejoinder to the cross-objections on dated 11.9.2026.
4.1 The appellant stated in its re-joinder that the respondent department itself had
accepted that Notification No. 9/2022-Central Tax (Rate), dated 13.07.2022,
came into force prospectively with effect from 18.07.2022. According to the
appellant, the dispute, therefore, primarily concerns the subsequent filing of the
refund application.
4.2. In this regard, the appellant relied upon and reiterated Grounds Nos. 6.2 and 9.1
of the memorandum of appeal, contending that Section 54(1) of the CGST Act,
2017, permits the filing of a refund application within the prescribed period of
two years and that the present refund application was filed within the said period
of limitation.
4.3 The appellant further relied upon Ground No. 10.1, read with Grounds Nos. 11.1,
11.2 and 12.2 to 12.5 of the memorandum of appeal, concerning subsequent
judicial pronouncements and the legal effect of the relevant circular having been
set aside or invalidated to the extent applicable.
The appellant stated in his re-joinder that the date of filing of the subsequent
refund application, relied upon by the respondent solely on the basis of the
aforesaid circular, could not, by itself, be determinative of the appellant’s
eligibility for refund of ITC accumulated during a tax period prior to 18.07.2022.
4.4 The Appellant stated in his re-joinder that the appellant had no absolute vested
right to a refund, the refund claim was required to be examined in accordance
with Section 54 of the CGST Act, 2017, the applicable statutory provisions, and
the relevant judicial pronouncements.
4.5 Accordingly, the appellant maintained that the grounds raised in the cross-
objections were not sustainable and reiterated its prayer for allowing the appeal.
The learned counsel for the appellant, while filing a rejoinder to the cross-
objections preferred by the respondents, prayed that the appeal be allowed.
4.6 The appellant also filed a paragraph-wise reply to the counter filed by the
respondents on 19.09.2026. In the said reply, the appellant furnished a specific
paragraph-wise response to the averments made in the respondents’ counter and

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reiterated and reaffirmed the facts and submissions already set out in the
rejoinder filed earlier in response to the respondents’ counter.
Points for Determination
5.0 Whether the Appellant’s claim for refund of unutilized Input Tax Credit (ITC)
accumulated on account of an inverted duty structure for the period from May
2020 to March 2021 can be denied solely on the ground that the refund
application was filed after 18 July 2022?
5.1 Whether the restriction on refund introduced vide Notification No. 09/2022-
Central Tax (Rate), dated 13 July 2022, read with Circular No. 181/13/2022-
GST, dated 10 November 2022, is applicable to the Appellant’s refund claim,
particularly when the claim is stated to have been filed within the period of
limitation prescribed under Section 54(1), read with Section 54(3), of the CGST
Act, 2017?
5.2 Whether the adjudicating authority and the First Appellate Authority erred in
rejecting the Appellant’s refund claim by applying the aforesaid notification and
circular?
5.3 Whether the impugned orders passed by the adjudicating authority and the First
Appellate Authority are legally sustainable?

Submissions on Behalf of the Appellant
6.0 The learned counsel for the appellant, while advancing arguments on the grounds
raised in the appeal, submitted that the appellant is engaged in the manufacture
and supply of edible oils. The principal contention of the appellant is that it had
accumulated unutilized input tax credit (ITC) on account of an inverted duty
structure during the period from May 2020 to March 2021 and had claimed a
refund of ₹61,47,671 under Section 54(3) of the Central Goods and Services Tax
Act, 2017 (hereinafter referred to as the “CGST Act”), before the original
adjudicating authority within the prescribed period of limitation. According to
the learned counsel, the entire refund claim pertains to the period preceding the
introduction of the restriction under Notification No. 09/2022–Central Tax
(Rate), dated 13.07.2022, which came into effect on 18.07.2022.

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6.1 The learned counsel submitted that the substantial question of law arising for
consideration in the present appeal is whether a refund of unutilized ITC
accumulated on account of an inverted duty structure during a period prior to
18.07.2022 can be denied solely on the ground that the refund application was
filed after the said date.
6.2 The learned counsel further submitted that Section 54(3) of the CGST Act
specifically provides for the refund of unutilized ITC accumulated on account of
an inverted duty structure, subject to the statutory conditions. It was argued that
the refund claim must be examined with reference to the relevant tax period and
the applicable statutory provisions. The appellant also relied upon the limitation
prescribed under Section 54(1) of the CGST Act for filing a refund application
and contended that the claim had been submitted within the prescribed period.
6.3 It was further contended that the ITC in question had accumulated during the
period from May 2020 to March 2021, when the restriction subsequently
introduced by Notification No. 09/2022–Central Tax (Rate) was not in force.
According to the appellant, the entitlement to seek refund in respect of the
accumulated ITC had arisen under the statutory provisions applicable to the
relevant period, and such entitlement could not be defeated merely by the
subsequent filing of the refund application or by a later administrative
clarification.
6.4 The learned counsel further submitted that CBIC Circular No. 181/13/2022-
GST, dated 10.11.2022, is administrative in nature and cannot override or curtail
the rights available under the parent statute. It was argued that the circular could
not validly extend the restriction introduced by the notification to ITC
accumulated before 18.07.2022 merely because the refund application was filed
on or after that date.
6.5 The learned counsel placed reliance upon the judgments of the Hon’ble High
Court of Andhra Pradesh in Gemini Edibles and Fats India Limited and Priyanka
Refineries Private Limited; the Hon’ble Gujarat High Court in Patanjali Foods
Limited; the Hon’ble Rajasthan High Court in Shree Arihant Oil and General
Mills; the Hon’ble Allahabad High Court in Vaibhav Edibles Private Limited;
and the Hon’ble Calcutta High Court in Adani Wilmar Limited. On the strength

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of these judicial precedents, the learned counsel submitted that the relevant tax
period is material for determining refund eligibility, that Notification No.
09/2022–Central Tax (Rate) operates prospectively from 18.07.2022, and that
the clarification contained in Circular No. 181/13/2022-GST cannot be applied
to deny refund of ITC accumulated before that date merely because the
application was filed subsequently.
6.6 The learned counsel particularly relied upon the judgment of the Hon’ble High
Court of Andhra Pradesh in Gemini Edibles and Fats India Limited, wherein the
Court held Circular No. 181/13/2022-GST to be unsustainable to the extent that
it restricted refund eligibility by reference to the date of filing the application
rather than the period of accumulation of ITC. It was further submitted that the
Hon’ble Supreme Court dismissed the Revenue’s special leave petitions arising
from the said judgment on 09.05.2025.
6.7 The learned counsel also referred to the procedural history of the refund claim
and submitted that an earlier refund application had been filed on 18.06.2022 but
was subsequently withdrawn on account of a legal infirmity. Thereafter, a fresh
application in FORM GST RFD-01 was filed on 25.03.2023 in respect of the
ITC accumulated during the period from May 2020 to March 2021. The fresh
application was acknowledged in FORM GST RFD-02. According to the learned
counsel, the subsequent application was nevertheless rejected by the original
adjudicating authority by relying upon the date of filing and the aforesaid
notification and circular, without properly appreciating the period to which the
accumulated ITC pertained.
6.8 In view of the foregoing submissions and the judicial precedents relied upon, the
learned counsel for the appellant prayed that the impugned orders passed by the
original adjudicating authority and the first appellate authority be set aside and
that the appeal be allowed in accordance with law.
Submissions of the Respondent
7.0 The learned counsel appearing for the respondent submitted that there is no
dispute regarding the prospective operation of Notification No. 09/2022-Central
Tax (Rate), dated 13.07.2022, which came into effect from 18.07.2022.

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However, it was contended that the said notification has no retrospective
application in the present case.
7.1 The learned counsel primarily argued that the appellant filed the refund
application in question on 25.03.2023, after the notification had come into effect.
In this regard, reliance was placed on Circular No. 181/13/2022-GST, dated
10.11.2022. It was submitted that the restriction prescribed under the said
notification would apply to all refund applications filed on or after 18.07.2022,
whereas applications filed before that date would remain outside the scope of the
said restriction.
7.2 The learned counsel further submitted that the prospective operation of the
notification is not in dispute. The question for consideration in the present case,
however, is whether a fresh refund application filed on 25.03.2023 can be
considered without reference to a restriction that was already in force on the date
of its filing.
7.3 The learned counsel further argued that Circular No. 181/13/2022-GST
expressly clarifies that the restriction would apply to all refund applications filed
on or after 18.07.2022 and would not apply to applications filed before that date.
According to the learned counsel, the interpretation advanced by the appellant
would require the importation of a qualification that is not contained in the said
clarification.
7.4 With regard to the judicial precedents relied upon by the appellant, including
Patanjali Foods and Gemini Edibles, the learned counsel submitted that judicial
precedents must be considered in their respective factual and legal contexts. It
was contended that the present case is materially distinguishable from those
cases because the original refund application dated 18.06.2022 was voluntarily
withdrawn on 25.07.2022, and a fresh application was filed only on 25.03.2023.
Accordingly, the judicial precedents relied upon by the appellant could not be
applied mechanically to the facts of the present case.
7.5 On the aforesaid grounds, the learned counsel for the respondent supported the
impugned orders and submitted that the appeal was liable to be dismissed.

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FINDINGS AND DECISION
8.0 We have heard the learned counsel appearing for the appellant as well as the
respondent at length. We have also carefully perused the records of the case and
considered the submissions advanced by both sides.
8.1 Upon perusal of the record, it is evident that the appellant, M/s Kedia Agro,
through its proprietor, Harish Kedia, is engaged in the manufacture and supply
of edible oils. In the course of its business, the appellant procures raw materials
and other inputs on some of which the rate of GST is higher than the rate
applicable to its outward supplies of finished goods. Consequently, the appellant
accumulates input tax credit (ITC) on account of an inverted duty structure.
8.2 It is further evident from the record that, for the period from May 2020 to March
2021, the appellant initially filed an application in Form GST RFD-01 on
18.06.2022, claiming a refund of ₹65,04,986 on account of the accumulation of
ITC due to the inverted duty structure. An acknowledgement in Form GST RFD-
02 was issued in respect of the said application.
8.3 It is also evident that the appellant subsequently withdrew the aforesaid refund
application dated 18.06.2022 and filed a fresh application in Form GST RFD-01
on 25.03.2023, claiming a refund of ₹61,47,671 for the same period, i.e., May
2020 to March 2021. An acknowledgement in Form GST RFD-02 was issued on
06.04.2023 in respect of the fresh application.
8.4 The record further reveals that the Assistant Commissioner of Central Tax,
Mehdipatnam GST Division, Hyderabad, issued a show-cause notice in Form
GST RFD-08, dated 04.05.2023, bearing ARN No. AA36032303697U, calling
upon the appellant to show cause as to why its refund claim of ₹61,47,671 should
not be rejected. The notice was issued under Rule 92(3) of the CGST Rules,
2017, read with Section 54 of the CGST Act, 2017, and the appellant was
required to submit its reply within fifteen days.
8.5 In response to the aforesaid show-cause notice, the appellant submitted its reply
in Form GST RFD-09 on 19.05.2023 before the Adjudicating Authority. The
Adjudicating Authority considered the reply submitted by the appellant and
thereafter proceeded to pass the order impugned in the present appeal.

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8.6 The Adjudicating Authority, after considering the reply and the material
available on record, passed the impugned order bearing ARN No.
AA36032303697U, dated 23.05.2023, holding that the appellant had filed the
refund application after 18.07.2022. Accordingly, the Adjudicating Authority
found the refund claim liable to be rejected under Rule 92(3) of the CGST Rules,
2017, read with Sections 74 and 54 of the CGST Act, 2017, and rejected the
appellant’s refund claim.
8.7 Being aggrieved by the order passed by the Original Adjudicating Authority, the
appellant preferred an appeal bearing Appeal No. 55/2023-Hyderabad-GST-JC
before the First Appellate Authority, namely, the Joint Commissioner of Central
Tax (Appeals-I), Hyderabad.
8.8 The record further reveals that the First Appellate Authority, after considering
the submissions advanced by the appellant and the respondent, the documents
placed on record, and the findings recorded by the Original Adjudicating
Authority, concurred with the conclusions arrived at by the Adjudicating
Authority. Accordingly, the First Appellate Authority rejected the appellant’s
appeal by the impugned appellate order.
8.9 Being aggrieved by the aforesaid orders passed by the Adjudicating Authority
and the First Appellate Authority, the appellant has preferred the present appeal
before this Tribunal.
8.10 Notification No. 09/2022-Central Tax (Rate), dated 13.07.2022, issued at New
Delhi, and CBIC Circular No. 181/13/2022-GST, dated 10.11.2022, contain the
following relevant provisions.
Notification No. 09/2022-Central Tax (Rate), New Delhi, the 13th July, 2022
G.S.R. (E).- In exercise of the powers conferred by clause (ii) of the proviso to
sub-section (3) of section 54 of the Central Goods and Services Tax Act, 2017
(12 of 2017), the Central Government, on the recommendations of the Council,
hereby makes the following further amendments in the notification of the
Government of India in the Ministry of Finance (Department of Revenue), No.
5/2017-Central Tax (Rate), dated the 28th June, 2017, published in the Gazette
of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R.
677(E), dated the 28th June, 2017, namely :-
In the said notification,

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(i) in the opening paragraph, in the proviso, in clause (i), for the words and
figure “serial numbers 1”, the words, figure and letters “serial numbers
1AA” shall be substituted;
(ii) in the TABLE, S. No. 1 shall be re-numbered as S. No. 1AA, and before S.
No. 1AA as so re-numbered, the following serial numbers and entries shall
be inserted, namely :-

1 2 3
“1A
.
1507 Soya-bean oil and its fractions, whether or not
refined, but not chemically modified

1B. 1508 Ground-nut oil and its fractions, whether or
not refined, but not chemically modified.
1C. 1509 Olive oil and its fractions, whether or not
refined, but not chemically modified.
1D. 1510 Other oils and their fractions, obtained solely
from olives, whether or not refined, but not
chemically modified, including blends of these
oils or fractions with oils or fractions of
heading 1509
1E. 1511 Palm oil and its fractions, whether or not
refined, but not chemically modified.
1F. 1512 Sunflower-seed, safflower or cotton-seed oil
and fractions thereof, whether or not refined,
but not chemically modified.
1G. 1513 Coconut (copra), palm kernel or babassu oil
and fractions thereof, whether or not refined,
but not chemically modified.
1H 1514 Rape, colza or mustard oil and fractions
thereof, whether or not refined, but not
chemically modified.
1I. 1515 Other fixed vegetable or microbial fats and
oils (including jojoba oil) and their fractions,
whether or not refined, but not chemically
modified.
1J. 1516 Vegetable fats and oils and their fractions,
partly or wholly hydrogenated, inter-
esterified, re-esterified or elaidinised, whether
or not refined, but not further prepared.
1K. 1517 Edible mixtures or preparations of vegetable
fats or vegetable oils or of fractions of
different vegetable fats or vegetable oils of this
Chapter, other than edible fats or oils or their
fractions of heading 1516

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1L. 1518 Vegetable fats and oils and their fractions,
boiled, oxidised, dehydrated, sulphurised,
blown, polymerised by heat in vacuum or in
inert gas or otherwise chemically modified,
excluding those of heading 1516
1M. 2701 Coal; briquettes, ovoids and similar solid fuels
manufactured from coal
1N. 2702 Lignite, whether or not agglomerated,
excluding jet
1O. 2703 Peat (including peat litter), whether or not
agglomerated”

2. This notification shall come into force on the 18th day of July, 2022.

8.11 Circular No. 181/13/2022-GST
F. No. CBIC-20021/4/2022
Government of India
Ministry of Finance
Department of Revenue
Central Board of Indirect Taxes and Customs
GST Policy Wing
New Delhi, Dated the 10th November, 2022

Clarification on refund related issues-reg.
Attention is invited to sub-section (3) of section 54 of CGST Act, 2017, which
provides for the refund of unutilized input tax credit in cases where credit is
accumulated on account of rate of tax of inputs being higher than the rate of
tax on output supplies i.e. on account of inverted duty structure. Sub-rule (5)
of rule 89 of CGST Rules, 2017 prescribes the formula for grant of refund in
cases of inverted duty structure. Vide Notification No. 14/2022-Central Tax
dated 05.07.2022, amendment has been made in the formula prescribed under
sub-rule (5) of rule 89 of the CGST Rules, 2017. Further, vide Notification
No. 09/2022-Central Tax (Rate) dated 13.07.2022, which has been made
effective from 18.07.2022, the restriction has been placed on refund of
unutilised input tax credit on account of inverted duty structure in case of
supply of certain goods falling under chapter 15 and 27.
2. Representations have been received from the trade and the field formations
seeking
clarification on various issues pertaining to the implementation of the above
notifications. In order to clarify the issues and to ensure uniformity in the
implementation of the provisions of law across the field formations, the
Board, in exercise of its powers conferred by section 168 (1) of the Central
Goods and Services Tax Act, 2017 (hereinafter referred to as “CGST Act”),
hereby clarifies the issues as under:

17


S. No. Issue Clarification

1
Whether the formula
prescribed under sub-rule (5) of
rule 89 of the CGST Rules, 2017
for calculation of refund of
unutilised input tax credit on
account of inverted duty
structure,
Vide Notification No.
14/2022-Central Tax dated
05.07.2022, amendment has been
made in sub-rule (5) of rule 89 of
CGST Rules, 2017, modifying the
formula prescribed therein. The said
amendment is not clarificatory in
nature and is applicable
prospectively with effect from
05.07.2022. Accordingly, it is
clarified that the said amended
formula under sub-rule (5) of rule 89
of the CGST Rules, 2017 for
calculation of refund of input tax
credit on account of inverted duty
structure would be applicable in
respect of refund applications filed on
or after 05.07.2022. The refund
applications filed before 05.07.2022
will be dealt as per the formula as it
existed before the amendment made
vide Notification No. 14/2022-
Central Tax dated 05.07.2022.

as amended vide
Notification No. 14/2022-
Central Tax dated 05.07.2022,
will apply only to the refund
applications filed on or after
05.07.2022, or whether the
same will also apply in respect
of the refund applications filed
before 05.07.2022 and
pending with the proper officer
as on 05.07.2022?


2 Whether the restriction placed
on refund of unutilised input tax
credit on account of inverted
duty structure in case of certain
goods falling under chapter 15
and 27 vide Notification No.
09/2022-Central Tax (Rate)
dated 13.07.2022, which has
been made effective from
18.07.2022, would apply to the
refund applications pending as
on 18.07.2022 also or whether
the same will apply only to the
refund applications filed on or
after 18.07.2022 or whether the
same will be applicable only to
Vide Notification No. 09/2022-
Central Tax (Rate) dated 13.07.2022,
under the powers conferred by clause
(ii) of the first proviso to sub-section
(3) of section 54 of the CGST Act,
2017, certain goods falling under
chapter 15 and 27 have been
specified in respect of which no
refund of unutilised input tax credit
shall be allowed, where the credit has
accumulated on account of rate of tax
on inputs being higher than the rate
of tax on the output supplies of such
specified goods (other than nil rated
or fully exempt supplies). The said
notification has come into force with
effect from 18.07.2022. The
restriction imposed vide Notification

18

refunds pertaining to
prospective tax periods?
No. 09/2022-Central Tax (Rate)
dated 13.07.2022 on refund of
unutilised input tax credit on account
of inverted duty structure in case of
specified goods falling under chapter
15 and 27 would apply prospectively
only. Accordingly, it is clarified that
the restriction imposed by the said
notification would be applicable in
respect of all refund applications
filed on or after 18.07.2022, and
would not apply to the refund
applications filed before 18.07.2022.


3. It is requested that suitable trade notices may be issued to publicize the
contents of this Circular.
4. Difficulty, if any, in implementation of this Circular may please be brought to
the notice of the Board.
9.0 On perusal of Notification No. 09/2022-Central Tax (Rate), dated 13.07.2022, it
is evident that the said notification came into force with effect from 18.07.2022.
Further, CBIC Circular No. 181/13/2022-GST, dated 10.11.2022, expressly
provides as follows:
“The restriction imposed by Notification No. 09/2022-Central Tax (Rate), dated
13.07.2022, on refund of unutilized input tax credit on account of inverted duty
structure in case of specified goods falling under Chapters 15 and 27 would apply
prospectively only. Accordingly, it is clarified that the restriction imposed by the
said notification would be applicable in respect of all refund applications filed on
or after 18.07.2022 and would not apply to refund applications filed before
18.07.2022.”
Thus, it is evident that the restriction imposed by the aforesaid notification on
refund of unutilized Input Tax Credit accumulated on account of an inverted duty
structure in respect of specified goods falling under Chapters 15 and 27 operates
prospectively.
The aforesaid circular further clarifies that the restriction imposed by the
notification applies to refund applications filed on or after 18.07.2022 and does
not apply to refund applications filed before that date.

19

9.1 Accordingly, it is clear that CBIC Circular No. 181/13/2022-GST, being
clarificatory in nature, clarifies the date from which the restriction imposed by the
notification is applicable. The restriction introduced by the notification is
prospective and does not extend to refund applications filed before 18.07.2022.
9.2 The learned counsel for the Appellant submitted that the Appellant had initially
filed a refund application in Form GST RFD-01 on 18.06.2022, claiming a refund
of unutilized Input Tax Credit accumulated on account of the inverted duty
structure for the period from 01.05.2020 to 31.03.2021. The corresponding
acknowledgement in Form GST RFD-02 was also issued.
9.3 The learned counsel further submitted that the aforesaid refund application was
subsequently withdrawn and that a fresh refund application in Form GST RFD-
01, bearing ARN, was filed on 25.03.2023 for the same period, claiming a refund
of ₹61,47,671.71. The corresponding acknowledgement in Form GST RFD-02
was issued on 06.04.2023.
9.4 The principal contention of the learned counsel is that the refund claim pertains to
unutilized Input Tax Credit accumulated on account of the inverted duty structure.
It was argued that, upon a conjoint reading of Notification No. 09/2022-Central
Tax (Rate), dated 13.07.2022, and CBIC Circular No. 181/13/2022-GST, dated
10.11.2022, it is clear that the restriction imposed by the notification operates
prospectively. According to the clarification contained in the circular, the
restriction applies to refund applications filed on or after 18.07.2022 and does not
apply to applications filed before that date.
9.5 The learned counsel contended that the Original Adjudicating Authority and the
First Appellate Authority rejected the Appellant’s refund claim solely on the
ground that the subsequent refund application had been filed after 18.07.2022. It
was submitted that the authorities failed to properly consider the prospective
operation of the notification and the clarification contained in the circular while
deciding the refund claim.
9.6 The learned representative of the Respondent-Department submitted that the
Appellant had initially filed a refund application on 18.06.2022, claiming
₹65,04,486 in respect of unutilized Input Tax Credit accumulated on account of
the inverted duty structure for the period from 01.05.2020 to 31.03.2021. The said

20

application was subsequently withdrawn, and a second refund application was
filed on 25.03.2023 for the same period.
9.7 The principal contention of the Respondent-Department is that the refund
application dated 25.03.2023 was filed after 18.07.2022 and, therefore, the
restriction imposed by Notification No. 09/2022-Central Tax (Rate), dated
13.07.2022, read with CBIC Circular No. 181/13/2022-GST, dated 10.11.2022,
was applicable to the Appellant’s claim. It was accordingly submitted that the
Original Adjudicating Authority had committed no error in rejecting the refund
claim and that the First Appellate Authority had also rightly upheld the order of
the Original Adjudicating Authority.
9.8 During the course of arguments, the learned counsel for the Appellant also drew
the attention of the Bench to the judgment of the Hon’ble High Court of Andhra
Pradesh at Amaravati in M/s Gemini Edibles and Fats India Limited v. Assistant
Commissioner of Central Tax, in the writ petitions stated to have been numbered
W.P. Nos. 5253 of 2023 and 12485, 12487 and 12488 of 2024, decided on
29.01.2025. The learned counsel relied upon the said judgment in support of the
grounds and submissions raised in the present appeal.
9.9 The further submissions of the learned counsel concerning the facts, findings and
directions contained in the aforesaid judgment are to be considered in the
following paragraphs.
9.10 The Hon’ble High Court of Andhra Pradesh, in M/s Gemini Edibles and Fats India
Limited v. Assistant Commissioner of Central Tax, held, in substance, that where
the relevant notification had been made effective from 18.07.2022, any Input Tax
Credit accumulated prior to that date on account of the difference between the tax
paid on inputs and the tax payable on outward supplies could be claimed as a
refund by a registered person by filing an application under Section 54 of the
CGST Act, 2017.
Hon’ble High Court of Andhra Pradesh AT AMARAVATI for
COMMERCIAL TAX WRIT PETITION NO: 12485/2024 Between:
Gemini Edibles And Fats India Limited AND The Assistant
Commissioner Of Central Taxes and Others judgement is reproduced
below:

21

Paragraphs 14 to 20 of the above Judgement are reproduced below
for ready reference.
14.“ Section 54 of the CGST Act states that any person claiming refund
of any tax and interest, if any, may make an application before the
expiry of two years from the relevant date in such form as may be
prescribed. Sub-section (3) of Section 54 reads as follows:
(3) subject to the provisions of sub-section (10), a registered person may
claim refund of any unutilized input tax credit at the end of any tax
period:
Provided that no refund of unutilized input tax credit shall be allowed
in cases other than—
(i) Zero rated supplies made without payment of tax;
(ii) Where the credit has accumulated on account of tax on inputs
being higher than the rate of tax on output supplies (other than nil
rated or fully exempt supplies), except supplies of goods or services
or both as may be notified by the Government on the recommendations
of the Council: 1 AIR 1978 SC 851 Provided further that no refund of
unutilized input tax credit shall be allowed in cases where the goods
exported out of India are subjected to export duty: Provided also that
no refund of input tax credit shall be allowed, if the supplier of goods
or services or both avails of drawback in respect of central tax or
claims refund of the integrated tax paid on such supplies.
15. As per sub-section (3) of Section 54, any registered person who is
supplying any kind of goods would be entitled for refund of input tax
credit once the rate of tax on inputs is higher than the rate of tax on
the output supply made by him. However, the very same provision also
stipulates that the Government, on the recommendations of the
council, can notify goods which would not be eligible for such refund.
16.In the present case, the Government, by Notification No.5/2017 dated
28.07.2017, had initially set out a list of goods which would not be
eligible for claiming refund under Section 54 of the CGST Act.
Subsequently, this list was increased by inclusion of various other

22

goods, by Notification No.9/2022 dated 13.07.2022. The goods, so
included, were various kinds of edible oils and specialty fats apart
from coal, lignite etc. This notification came into force on 18.07.2022.
17.In view of the specific stipulation that the Notification comes into
effect only from 18.07.2022, it would clearly mean that input tax credit
which accumulates in the tax credit ledger of the registered person,
on account of the mismatch between the input tax and the output tax,
before 18.07.2022, can be recovered by the registered person, by way
of an application under 10 Section 54 of the CGST Act. This would not
mean that, an application cannot be made after 18.07.2022.
Restriction would apply only to the extent of input tax credit arising
after 18.07.2022.
18.In the impugned circular, while clarifying that the notification is
prospective, the Government went on to state that applications cannot
be made after 18.07.2022. This Court finds that the said clarification
is neither logical nor in accordance with the understanding of law in
such cases.
19.This Court would hold that once a stipulation is made that the
notification, in question, operates from 18.07.2022, it would mean that
any input tax credit which arose on account of the mismatch between
the input tax and the output tax, prior to 18.07.2022, can always be
recovered by the registered person, by making an application under
Section 54 of the CGST Act.
20 In the circumstances, we are of the opinion that Circular
No.181/13/2022-GST, dated 10.11.2022, would have to be struck
down, to the extent of the clarification that the restriction imposed by
the Notification, dated 13.07.2022, would be applicable in respect of
all refund applications filed on or after 18.07.2022” .

10.0 In the above judgement, Hon’ble High Court of Andhra Pradesh directly
addressed the question of whether refund of ITC accumulated during the periods
prior to 18.07.2022 could be denied on the ground that the refund application

23

was filed after 18.07.2022. After careful examination of concerned notification
and circular in their proper legal context, Hon’ble Division Bench held that
restrictions imposed by the above referred circular, would apply only to the
extent of ITC arriving after 18.07.2022. The court found that, the said
clarification is neither logical nor in accordance with the understanding of law in
such case. In para 20 of judgement (supra) the Hon’ble High Court struck down
the circular, to the extent of clarification that the restriction imposed by the
notification 09/2022 dated 13.07.2022, would be applicable in respect of all
refund applications filed on or after 18.07.2022, before setting aside refund
rejection orders.
10.1 Further, the above said judgement was challenged by Revenue authorities before
the Hon’ble Supreme Court by way of Special Leave Petition (s), stated to bear
C.Nos. 12495-12498 of 2025, which were dismissed on 09.05.2025.
10.2 In case of Patanjali Foods Ltd. Vs UOI (C/SCA/17298/2024 DB Gujarat HC)
dated 12.02.2025, on identical issue, it was held at para 11.6, that the restrictions
contained in the impugned circular dated 10.11.2022 “ is wholly arbitrary,
discriminatory and ultra-vires to Sec.54 of GST Act as well as violating Article
14 of Constitution of India”. Further, held that the impugned circular has created
an artificial class amongst assesses based on the date of filing of refund
application.
10.3 Similar views were held by Division Bench of Hon’ble High Court of Rajasthan
(Jodhpur) in Shree Arihant Oil and General Mills V. UOI, civil writ petition No.
2932/2023, decided on 08.09.2025, referring to Gemini Edibles and Fat India
Ltd (Supra) and Patanjali Foods Ltd (Supra) Judgements.
10.4 In case of M/s Vaibhav Edible Private Ltd V. State of UP & 2 others ( writ tax
1060 of 2024 DB, High Court Allahabad decided on 13.11.2025) the Hon’ble
Division Bench of Allahabad HC, on identical issue, in a batch of four writ
petitions held that, Revenue did not advance any submissions that could warrant
a view different from that taken by the Andhra Pradesh High Court (supra) and
allowed the appeal.
10.5 Relying on above four High Court judgements (supra), Calcutta High Court in
WPA 27066 of 2024 ( dated 25.02.2026), in case of M/s Adani Wilmar Ltd. Vs

24

Assistant Commissioner of State Tax & Ors, held that there is no good reason
for this court to take a divergent view.
10.6 Revenue in its cross objections and submissions, stated that they are intending to
file review petition against the dismissal by Hon’ble Supreme Court in case of
Gemini Edibles case (supra), but no documentary evidence was placed before
this Bench.

Conclusions
11.0
(i) The second refund application pertaining to the period from May, 2020 to
March 2021 was filed on 25.03.2023. It is within the stipulated period of
two years under Section 54 (3) of the GST Act read with Rule 89 of the
CGST Rules 2017.
(ii) The lower authorities rejected the refund application on the ground that it
was filed after 18.07.2022 and restrictions imposed vide circular dated
10.11.2022 are applicable.
(iii) Though the concerned notification and circular stated that they are
prospective in application, the authorities have interpreted that they are
applicable to the ITC accumulated for the period prior to 18.07.2022.
(iv) Though the notification dated 13.07.2022 did not contain any stipulation
on restricting the right to claim refund for application filed after certain
date, the circular appears to have restricted the right for claims filed after
18.07.2022 for the credit accrued in the periods before that date.
(v) ITC is a right accrues to the assessee on the date when dutiable goods /
services were bought in the course of furtherance of business. Such a right
can’t be curtailed by the interpreting an executive circular by giving it
retrospective effect, without any statutory / legal backings.
(vi) As discussed in para 9 & 10 (supra), various Hon’ble High Courts have
struck down the restrictions contained in para 2 of impugned circular
dated 10.11.2022 and some have declared them as ultra-vires.

25

12.0 From the above discussions, it is evident that the findings in the impugned order
are solely based on the restrictions imposed at para 2 of the circular dated
10.11.2022. That impugned para was struck down by Division Benches of
various Hon’ble High Courts as discussed above. There is no documentary
evidence produced by Revenue about filing any review / appeal in Hon’ble
Supreme Court. After due consideration of all facts of the case and respectfully
following the judicial decisions (supra), we are of the opinion that the impugned
order can’t be sustained. Accordingly, the impugned order rejecting the refund
claim is set aside with consequential relief. The original Adjudicating
Authority is directed to reconsider and decide the Appellant’s refund claim
afresh in accordance with law and applicable judicial precedents. With regard
to claim of interest from the applicable date and as per law, by the appellant,
the same may be examined as per legal provisions during the refund
proceedings as ordered above.
12.1 The points of determination in paragraph 13 above are answered accordingly.
12.2 Accordingly, the appeal filed by the Appellant is allowed and the impugned
orders passed by the Original Adjudicating Authority (OAA) and the First
Appellate Authority are hereby set-aside. The OAA is directed to reconsider
and decide the Appellant’s refund claim afresh which was rejected earlier, in
accordance with law.
12.3 On the above terms, the appeal is disposed of.
12.4 No order as to costs.
(The final orders was pronounced in open court on 27.10.2026)

Digitally signed by
SUSHIL KUMAR SHARMA
27-10-2026 17:20:24 IST
(Sushil Kumar Sharma)



(Duvvuri Krishna Srinivas)
Dated: 27.10.2026