Challenge against order rejecting GST refund: Delhi HC Disposes of Petition on Availability of Statutory Remedy

Delhi High Court dismissed a writ petition challenging GST refund rejection, emphasizing the availability of statutory appellate remedies. Justice Sanjeev Sachdeva ruled that taxpayers must first exhaust the departmental appeal mechanism under Section 107 before approaching courts, except in exceptional circumstances. The case involved ₹42 lakh input tax credit refund denied due to alleged invoice mismatches. The judgment reinforces the principle that constitutional writ jurisdiction shouldn't bypass statutory hierarchies designed for specialized dispute resolution. However, the court clarified that prolonged delays in appellate disposal or patent jurisdictional errors may justify direct writ intervention. Tax professionals note this may increase litigation costs as taxpayers navigate multiple forums. The department has been directed to dispose of GST appeals within six months, addressing concerns about delayed justice. Businesses should carefully document refund applications and prefer statutory appeals unless facing exceptional hardship. The ruling balances judicial oversight with the GST Council's intent to create specialized appellate mechanisms for technical tax matters.