Patna High Court orders Rs 1.24 lakh refund and interest after taxpayer’s double payment

The Patna High Court has directed Central GST and Customs officials to refund a taxpayer Rs 1.24 lakh paid twice in pre-deposit, along with 12% interest and costs, highlighting issues in administrative procedural lapses and judicial intervention in tax disputes.

The Patna High Court has ordered Central GST and Customs officials to refund Rs 1.24 lakh to a taxpayer who paid the same appeal pre-deposit twice, and to compensate him with 12% annual interest and Rs 25,000 in costs. The bench said the department had ignored his repeated complaints and had left him with no realistic option but to move the court.

According to the order dated September 28, a division bench of Justices Rajeev Ranjan Prasad and Sunil Dutta Mishra said the payment should be made within four weeks. The court also said the authorities could examine which officials were responsible for the delay and recover the interest and litigation expenses from them, a sign of judicial frustration with the handling of what should have been a routine refund claim.

The dispute grew out of a service tax demand of Rs 16.56 lakh that the Joint Commissioner of CGST and Central Excise, Patna-I, raised against Shashi Kant Singh in September 2022. To pursue his appeal, Singh made the required pre-deposit, but that amount was apparently paid twice, leaving him out of pocket by Rs 1.24 lakh. After his attempts to secure a refund failed, the matter reached the high court, which found that the tax department had not acted on his representations.

The ruling fits a broader pattern of courts pressing tax authorities to avoid rigid or arbitrary conduct, particularly where procedural lapses block taxpayers from getting timely relief. In recent months, the Patna High Court has also intervened in other tax disputes involving recoveries and refunds, underscoring the importance of prompt administrative decision-making and fair treatment when the legal process is already under strain.