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Outbyte PC Repair FREERepair Windows errors before they cause bigger problemsFix Now →Outbyte Driver Updater FREEFix the driver behind crashes, sound loss and screen glitchesFind Drivers →Refex Industries Limited has won its GST appeal before the Commissioner (Appeals), CGST & Central Excise, Bhopal. The October 13, 2026 appellate order, received by Refex on October 15, vacated the ₹29,31,92,582 tax-and-penalty demand and associated interest arising from an input-tax-credit dispute. The company says ₹5,86,92,809 that it paid or reversed under protest becomes eligible for refund or re-credit, subject to the applicable law and procedure.
What the Bhopal appellate order decided
Order-in-Appeal Nos. 232-234/COMM/BHO/GST/2026-27 allowed Refex’s three appeals and held that the demand, interest and penalty confirmed in the original adjudication order were not sustainable. The decision removes the aggregate tax-and-penalty liability of ₹29,31,92,582. Any interest connected with that confirmed demand was also set aside.
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Refex disclosed that the order is not expected to have a material adverse impact on its financials, operations or other activities. The ruling is favorable at the Commissioner (Appeals) stage, but it is not necessarily the end of the dispute because the department retains a statutory appeal route.
Why the GST department raised the demand
The case began with proceedings by the Directorate General of GST Intelligence (DGGI), Raipur Zonal Unit. DGGI alleged that Refex had claimed input-tax credit of ₹14,65,96,291 on invoices from suppliers described in the proceedings as non-existent or fictitious. The invoices related to coal and ash-handling work during April 2018 to March 2021.
Refex’s original adjudication order, dated March 27, 2025, confirmed the entire alleged credit as tax, along with applicable interest and an equal penalty. The order invoked Section 74 of the Central Goods and Services Tax Act, 2017, read with Section 122(1)(vii) and Section 122(1)(x). The appeal authority has now held that this demand-and-penalty finding cannot stand.
Key amounts in the case
| Item | Amount | What it represents |
|---|---|---|
| Alleged ineligible input-tax credit | ₹14,65,96,291 | Credit DGGI alleged was claimed against invoices issued by allegedly non-existent or fictitious suppliers |
| Tax and penalty demand vacated | ₹29,31,92,582 | Aggregate amount confirmed in the original order and cancelled on appeal |
| Paid or reversed under protest | ₹5,86,92,809 | Amount Refex says is eligible for refund or re-credit, subject to law and procedural requirements |
Will Refex automatically receive the ₹5.87 crore?
No. The company’s disclosure says the ₹5,86,92,809 paid or reversed under protest becomes eligible for refund or re-credit subject to applicable law and procedure. The appellate order removes the underlying demand, but Refex still has to follow the relevant GST mechanism and satisfy requirements governing a refund or re-credit.
The final treatment can depend on how each amount was paid or reversed, the records supporting the claim, and statutory conditions such as the applicable limitation period and unjust-enrichment rules. The disclosure therefore establishes eligibility in principle, not an immediate cash payment or a guaranteed date for recovery.
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- February 29, 2024: DGGI issued show-cause notice No. 253/RZU/ADD/GST/2024.
- March 27, 2025: Order-in-Original No. 192/ADC/GST/DGGI/2024-25 confirmed the tax, interest and equal penalty.
- March 2025: Refex disclosed the demand and its intention to appeal.
- June 24, 2025: Refex filed three appeals under ARN Nos. AD220625013791C, AD220625013750I and AD220625013716A.
- October 13, 2026: The Commissioner (Appeals), Bhopal issued Order-in-Appeal Nos. 232-234/COMM/BHO/GST/2026-27.
- October 15, 2026: Refex received the order and disclosed the result to the stock exchanges.
Can the GST department appeal?
Yes. Refex’s filing expressly says the department retains the right to appeal before the GST Appellate Tribunal (GSTAT), when constituted, within the time prescribed under Section 112 of the CGST Act, 2017. That means the Commissioner (Appeals) decision currently cancels the demand, but the department may seek further review through the statutory appellate process.
The practical status is therefore that Refex has succeeded at the first appellate level. Whether the matter becomes final will depend on any departmental appeal, the applicable filing period and subsequent proceedings. The filing does not state that a GSTAT appeal has been filed.
What the decision means for Refex
- The ₹29.32 crore tax-and-penalty demand confirmed in the original order has been vacated.
- Associated interest under that order has also been held unsustainable.
- The dispute concerned alleged input-tax credit linked to suppliers DGGI characterized as non-existent or fictitious.
- ₹5.87 crore paid or reversed under protest may be pursued through refund or re-credit procedures, rather than being treated as an automatic repayment.
- Refex reported no expected material adverse effect on its financial position, operations or other activities from the appellate outcome.
- The department’s GSTAT appeal right means the legal process may continue.
What readers should watch next
The next material developments are whether the department files an appeal within the Section 112 period and how Refex applies for refund or re-credit of the protested amount. Investors should distinguish the cancelled demand from the separate recovery process: setting aside the assessment resolves the liability at this stage, while recovery of money already paid requires compliance with the GST refund framework.
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