Refex Industries Wins GST Appeal Over Rs 29 Crore Tax Demand

Aggregate demand of Rs 29.32 crore set aside by Commissioner (Appeals).
Company eligible to recover Rs 5.87 crore previously paid under protest.

Reader Takeaway: Legal relief on past tax liabilities improves liquidity, though the Department may still appeal to the GSTAT.

What just happened

Refex Industries has received a major legal reprieve from the Commissioner (Appeals), CGST & Central Excise, Bhopal. The appellate authority issued an order dated October 13, 2026, which effectively sets aside a tax, interest, and penalty demand totaling Rs 29.32 crore. This demand originated from an Order-in-Original dated March 27, 2025, which had previously ruled against the company.

Why this matters

The ruling brings an end to a long-standing dispute regarding the company’s input tax credit (ITC) claims. Beyond the cancellation of the Rs 29.32 crore liability, the company is now entitled to seek a refund or re-credit of Rs 5.87 crore, which was previously deposited under protest. This recovery will provide a boost to the company’s cash position and balance sheet.

The backstory

The dispute, initiated by the Directorate General of GST Intelligence (DGGI), Raipur Zonal Unit, centered on allegations that the company had availed ineligible ITC on invoices from suppliers the authorities claimed were non-existent. These transactions involved coal and ash handling services performed between April 2018 and March 2021. The appellate authority has now concluded that the evidence did not support the Department's allegations.

Risks to watch

Investors should remain cautious regarding the finality of this order. The Department retains the legal right to challenge this decision before the GST Appellate Tribunal (GSTAT) once it is fully constituted. Under Section 112 of the CGST Act, 2017, the authorities have a prescribed window to initiate a further appeal.

What to track next

Shareholders should monitor any subsequent filings regarding the refund process for the Rs 5.87 crore and any communication from the tax authorities regarding a potential appeal to the GSTAT.