{"id":4544,"date":"2025-06-26T08:28:28","date_gmt":"2025-06-26T02:58:28","guid":{"rendered":"https:\/\/www.centaxonline.com\/blog\/?p=4544"},"modified":"2025-06-26T08:28:28","modified_gmt":"2025-06-26T02:58:28","slug":"interest-on-gst-refund-delay-allowed-after-adjusting-petitioners-delay-hc","status":"publish","type":"post","link":"https:\/\/www.centaxonline.com\/blog\/interest-on-gst-refund-delay-allowed-after-adjusting-petitioners-delay-hc","title":{"rendered":"Interest on GST Refund Delay Allowed After Adjusting Petitioner\u2019s Delay | HC"},"content":{"rendered":"<pre><strong>Case Details: <a href=\"https:\/\/www.centaxonline.com\/latest-news-updates\/gst\/101010000000399899\/interest-on-delayed-gst-refund-to-be-allowed-excluding-time-taken-by-petitioner-to-reply-to-deficiency-memo-hc\">MSGS Industries Versus Commissioner of Central Tax and GST (2025) 31 Centax 197 (Del.)<\/a><\/strong><\/pre>\n<h2><em>Judiciary and Counsel Details<\/em><\/h2>\n<ul>\n<li><strong>Pratibha M. Singh<\/strong> &amp; <strong>Rajneesh Kumar Gupta<\/strong>, JJ.<\/li>\n<li><strong>Shri Siddharth Malhotra<\/strong>, Adv. for the Petitioner.<\/li>\n<li><strong>S\/Shri Aakarsh Srivastava<\/strong>, Sr. Standing Counsel, <strong>Anand Pandey<\/strong> &amp; <strong>Anugya Gupta<\/strong>, Advs. for the Respondent.<\/li>\n<\/ul>\n<h2><em>Facts of the Case<\/em><\/h2>\n<p>The petitioner filed two refund applications under the CGST Act and Delhi GST Act. In response, the jurisdictional officer issued deficiency memos. The petitioner submitted replies, upon which acknowledgements in FORM GST RFD-02 were issued. However, despite the acknowledgements, the refund was not granted within the prescribed 60-day period under Section 54(7) of the CGST Act. Following a writ petition, the High Court directed the Department to process the refund applications within three weeks, but the refund was rejected.<\/p>\n<p>The petitioner filed an appeal, and the Commissioner (Appeals), upon considering the contentions, passed an order allowing the refund. As this order remained unimplemented, a second writ petition was filed. The High Court again directed that the refund, along with applicable interest, be processed forthwith. Eventually, the refund was sanctioned by the Deputy Commissioner, CGST Delhi West, but interest was granted only in part. The matter was accordingly placed before the High Court of Delhi.<\/p>\n<h2><em>High Court Held<\/em><\/h2>\n<p>The High Court of Delhi held that interest under Section 56 of the CGST Act and Delhi GST Act was payable for the delay in refund processing, except for the period attributable to the petitioner\u2019s delay in responding to the deficiency memos. The Court observed that while the Department failed to issue deficiency memos within the prescribed timeframe, the petitioner also consumed a quantifiable period to rectify deficiencies. It was held that the said period must be excluded when computing interest liability. Interest at 6% per annum was directed for the initial phase of delay (after adjusting for the petitioner\u2019s delay), and 9% per annum was held applicable for the subsequent period until actual sanction. The interest already paid was to be adjusted against the total amount.<\/p>\n<h2><em>List of Cases Cited<\/em><\/h2>\n<ul>\n<li><a href=\"https:\/\/www.centaxonline.com\/search?searchData=2024%20(83)%20G.S.T.L.%20190&amp;itemType=AP\">Bansal International v. Commissioner of DGST<\/a> \u2014 2024 (83) G.S.T.L. 190\/(2023) 13 Centax 210 (Del.) \u2014 Referred [Para 11]<\/li>\n<li><a href=\"https:\/\/www.centaxonline.com\/search?searchData=2023%20(75)%20G.S.T.L.%20309&amp;itemType=AP\">G. S. Industries v. Commissioner Central GST<\/a> \u2014 2023 (75) G.S.T.L. 309\/(2023) 7 Centax 87 (Del.) \u2014 Referred [Para 6]<\/li>\n<li>G.S. Industries v. Pr. Commissioner of CGST \u2014 [W.P. (C) No. 9321 of 2020, dated 24-11-2020] \u2014 Referred [Para 4]<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Case Details: MSGS Industries Versus Commissioner of Central Tax and GST (2025)&hellip;<\/p>\n","protected":false},"author":8,"featured_media":4548,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[37,60,189],"tags":[],"class_list":["post-4544","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-gst","category-news","category-gst-case-chronicles"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.9 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Interest on GST Refund Delay Allowed After Adjusting Petitioner\u2019s Delay | HC<\/title>\n<meta name=\"description\" content=\"Delhi HC rules interest on delayed GST refund is payable under Section 56, excluding petitioner\u2019s delay in replying to 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