Union Bank’s ₹1.35-Crore GST Refund Claim Survives Only For February 2018, As GSTAT Applies COVID Limitation Exclusion

Union Bank of India filed a refund application on 6 May 2020 for ₹1,35,34,594, described as excess tax paid for March 2018.

Its supporting month-wise figures covered July 2017 to March 2018.

The adjudicating authority rejected the claim, finding that earlier months were time-barred and that there was no excess payment for March 2018.

The appellate authority set aside that decision and allowed the claim.

The Assistant Commissioner appealed to the GST Appellate Tribunal, which considered the limitation period separately for each monthly payment and the Bank’s alternative plea under Article 265 of the Constitution.

Section 54(1) of the Central Goods and Services Tax Act, 2017 provides a two-year period for refund applications, running from the relevant date; under clause (h) of the Explanation, the relevant date in an excess-tax-payment claim is the date of payment.

Notifications No. 35/2020-Central Tax and 55/2020-Central Tax extended time limits falling within the specified COVID-19 period, but did not revive periods that had expired before that period began.

Notification No. 13/2022-Central Tax and the Supreme Court’s directions in In Re: Cognizance for Extension of Limitation, Suo Motu Writ Petition (C) No. 3 of 2020 (10 January 2022), excluded the specified COVID-19 period from limitation and provided a 90-day period where limitation expired during that period.

The Tribunal also applied the principle that an Article 265 challenge may support refund outside Section 54 where the payment is shown to have been made without authority of law, distinguishing cases involving an admitted non-levy, an unconstitutional levy, or duplicate payment from a disputed reconciliation of tax returns.

The Tribunal held that a consolidated application could not shift the relevant date for each monthly payment to the end of the financial year: the excess, if any, had to be assessed month by month from the filing date of the corresponding GSTR-3B.

The July 2017–January 2018 periods had expired before the COVID-19 exclusion period and were not revived by the extension notifications or the later exclusion.

February 2018 was different: its limitation expired during the exclusion period, so the Tribunal held that the claim was saved under Notification No. 13/2022 and the Supreme Court’s limitation directions.

March 2018 was within time under Notifications No. 35/2020 and 55/2020, but the Bank’s own figures showed a shortfall, not an excess.

The Article 265 plea failed because the record did not establish that the relevant payments were unauthorized; it showed a dispute about reconciliation between GSTR-3B and GSTR-1.

It held that the July 2017–January 2018 claims were time-barred; the February 2018 refund was available and was to be quantified after separation from the consolidated claim; and no refund was payable for March 2018 because there was no excess payment for that month.

The Bank’s Article 265 plea was not established on the record.

No order as to costs.