Rule 96(10) of the CGST Rules, 2017 — Re-Credit of ITC –— The applicant prayed for directions to the Respondent authorities, to re-credit / restore the ITC of Rs.1,39,49,810/- in the electronic credit ledger along with interest. The applicant is importing its raw material by availing the benefit of the Notification No.79/2017-Customs dated 13.10.17 and the raw material so imported is used in the manufacturing of its products which, in turn, are exported by the writ applicant. The applicant inadvertently cleared and exported its finished goods upon payment of the IGST instead of exporting it under the ‘Letter of Undertaking’ (LoU) and periodically received auto-refund of the IGST paid at the time of exports. After realizing this inadvertent mistake, the applicant voluntarily paid the requisite IGST along with the interest on 13.08.2020. The applicant requested the authorities to re-credit/restore the ITC credit to the tune of Rs.1,39,49,810/- in the electronic credit ledger which was, inadvertently, utilized for payment of the IGST. The court observed that so far as the erroneous grant of refund and return of such refund amount together with interest by the writ-applicant is concerned, the same is undisputed. If the authorities have accepted that there was an error and resultantly, accepted repayment of the erroneous refund, as a corollary, the credit of the ITC must be restored. It cannot be that for the purpose of repayment, there was an error, and for the purpose of restoration of the ITC, there was no error. Once such an amount is repaid by the writ-applicant to the department, the original debit of the ITC must be recredited/restored. Otherwise, the same would amount to double taxation, which is not permissible in law.

 Held that:- The Hon’ble High Court directed the respondent authorities to re-credit/restore the ITC to the tune of Rs.1,39,49,810/- in the electronic tax ledger of the writ applicant, within a period of two weeks.