Bombay HC: Officer Accountability for Delayed GST Refunds, GST Council Directed to Examine Administrative Lapses

Bombay HC (Nagpur Bench) highlights the financial consequences of delays and administrative lapses in processing GST refund applications, directing the GST Council to examine the reasons for such delays and the portal restrictions affecting officers' ability to record detailed reasons for refund decisions. The petitioner had filed a refund application on 13 January 2025, which was rejected on 23 January 2025, the rejection order was subsequently set aside by the Court on 2 November 2026. HC notes that the officer's apparent lapses resulted in interest liability of ₹3,15,240, payable out of public funds. Referring to Section 56 of the CGST Act, the Court reiterates that where a refund ordered under Section 54(5) is not granted within 60 days of the application, interest at the notified rate of 6% is payable. HC thereby directs the GST Council to inquire into delays in passing refund orders and portal limitations that prevent officers from assigning detailed reasons, while granting liberty to the State Government or GST Council to recover the interest amount from the responsible officer, subject to the inquiry establishing such lapses. HC listed the matter for further consideration in the week commencing 14 December 2026.

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