GSTAT Kolkata Dismisses Revenue Appeals in Anil Kumar Singh Vs Director: ITC Refund Allowed Despite Toll Plaza Objections
Background and Context
The Goods and Services Tax Appellate Tribunal (GSTAT), Kolkata Bench, rendered a significant decision by dismissing two Revenue appeals — bearing appeal numbers APL/10/KLK/2026 and APL/14/KLK/2026 — which had challenged the orders of the first Appellate Authority permitting refund of accumulated Input Tax Credit (ITC) in favour of M/s Agarwala's Bitumex Private Limited. Since both appeals originated from the same set of facts and involved substantially identical legal questions, the Tribunal decided them through a single consolidated order with the consent of both parties.
The proceedings before the Tribunal arose from orders passed by the Joint Commissioner (Appeals), CGST & CX, Siliguri Appeal Commissionerate, vide Order-in-Appeal No. 295/SLG-GST/2025-26 and 296/SLG-GST/2025-26, both dated 12.09.2025. These appellate orders had reversed the earlier rejection orders passed by the Assistant Commissioner of CGST and Central Excise, Siliguri Division, Siliguri Commissionerate vide Order-in-Original bearing Ref Nos. ZD190525049468V dated 28.05.2025 and ZD190625009380H dated 05.06.2025.
Who Is the Respondent and What Does the Business Involve?
M/s Agarwala's Bitumex Private Limited, bearing GSTIN 19ABACA8140P1Z9, is registered at Holding No. 37/491/1/AB/8, Radha Bazar, Ground Floor, Thana More, S.F Road, Opposite Siliguri Thana, Ward No. 8, Siliguri, Darjeeling, West Bengal – 734004. The entity is engaged in trading iron/non-alloy steel bars and rods as well as bitumen, falling under HSN 7214 and 2714 respectively, and additionally carries out export of these goods outside India.
Being an exporter with accumulated ITC on inputs, the respondent filed refund applications under Section 54 of the Central Goods & Services Tax Act, 2017. The refund amounts claimed were:
- Rs. 11,41,828/- for the month of January 2025
- Rs. 27,65,697/- for the month of February 2025
These applications were filed before the jurisdictional Assistant Commissioner of CGST and Central Excise, Siliguri Division.
Sequence of Adjudication: From Original Orders to the Tribunal
Upon scrutiny of the refund applications, the original adjudicating authority detected what it considered deficiencies in both claims. Accordingly, Show Cause Notices were issued:
- SCN bearing Ref No. ZD190525023472G dated 15.05.2025 (relating to APL/14/KLK/2026)
- SCN bearing Ref No. ZD190525044217B dated 26.05.2025 (relating to APL/10/KLK/2026)
The respondent submitted replies to both SCNs. The original adjudicating authority, after following due process, rejected both refund claims. Aggrieved, the respondent approached the first Appellate Authority, which allowed the refund claims and set aside the original orders. The Revenue, dissatisfied with the appellate relief granted, escalated the matter to the GSTAT, Kolkata Bench.
Revenue's Grounds of Challenge Before the GSTAT
The Revenue advanced several grounds in support of its appeals:
1. Discrepancies in the Inward Supply Chain
The Revenue contended that the first Appellate Authority overlooked clear evidence of serious irregularities in the inward supply chain. It argued that the conclusion regarding admissibility of refund under Section 54(3) of the CGST Act, 2017 was factually incorrect given the allegedly non-genuine inward supplies.
2. Toll Plaza Movement Data — The Core Objection
A central plank of the Revenue's case was toll plaza movement data concerning 14 E-way bills (10 in respect of APL/10/KLK/2026 and 4 in respect of APL/14/KLK/2026). Revenue argued that all 14 consignments recorded their first toll crossing in Bihar rather than West Bengal, contradicting the declared dispatch location of Dhandebi Khanna Road, Kolkata-700054.
The Revenue maintained that while the "Bill To Ship To" model may explain why delivery occurred at Jogbani, Raxaul, or Sonauli, it could not legitimately explain the complete absence of any toll movement originating from West Bengal. According to the Revenue, the "Bill To Ship To" arrangement allows a different destination but does not validate or cure a situation where the movement never commenced from the declared dispatch point in West Bengal, amounting to a false origin declaration.
3. Cancellation of Second-Line Suppliers' Registrations
The Revenue pointed out that the respondent's immediate supplier, M/s KS Metals Pvt. Ltd. (GSTIN: 19AABCK3534H2ZK), had procured goods from two suppliers — M/s Bhadra Enterprises and M/s Maa Kali Traders — whose GST registrations had been cancelled ab initio, well before the transactions in question. Revenue argued this meant no genuine goods were available for supply, rendering the ITC ineligible.