Refund Of Excess Amount Lying To The Credit Of Electronic Cash Ledger Of The Petitioner

Facts:

• The petitioner is engaged in the business of trading of electronic goods over e-commerce platform by obtaining registration under the provisions of Goods and Service Tax Laws. • Due to maintenance of huge inventory on account of purchases affected to meet the forecasted demand, the petitioner invariably has excess balance of ITC in its electronic credit ledger, which is utilized for discharge of GST liability.

Legal Precedence:

M/S. APPARIO RETAIL PRIVATE LIMITED, VERSUS THE UNION OF INDIA, THROUGH ITS REVENUE SECRETARY, DEPARTMENT OF REVENUE, MINISTRY OF FINANCE NEW DELHI AND OTHERS.

Amount retained by the ECO and deposited with the Government under Section 52 of the CGST Act, as tax collected at source and reflected in petitioner’s electronic cash ledger remains unutilized; that the said unutilized balance in the petitioner’s electronic cash ledger can be claimed as refund in terms of Section 49(6) read with Section 54 of the CGST Act

Points Put Forth by the Applicant:

• The electronic cash ledger maintained on the GST portal is similar to e-wallet, where the e-wallet holder keeps its money to be appropriated against a specific liability to be discharged and if the remains unutilized, it can claim credit back of the same to its account.
• Secondly, when sale of goods is effected through ECO, and therefore, the amount retained by the ECO and deposited with the Government under Section 52 of the CGST Act, as TCS and reflected in petitioner’s electronic cash ledger remains unutilized due to immense value standing in electronic credit ledger due to large number of purchases.

Judgement:

The said refund application was adjudicated by the 5th respondent and a refund sanction order was passed granting refund of entire amount claimed.

Hrithik Sachdeva, Audit Associate, SW India