Bombay High Court Sets Aside Order Denying IGST Refund To Lubrizol, Orders Fresh Consideration

The Bombay High Court has set aside an order rejecting a refund claim of IGST on export of services, holding that the authority failed to properly consider the petitioner's contentions and the nature of the agreements between the parties.

A Division Bench comprising Justices G.S. Kulkarni and Aarti Sathe was hearing a writ petition filed by Lubrizol Advance Materials India Pvt. Ltd., which had challenged the rejection of its refund claim of Rs 56,11,885 for July 2024 on the ground that the services provided were “intermediary services” and not export of services.

The bench observed, “We are of the opinion that considering the nature of the impugned order as passed by Respondent No.2, the same is required to be reconsidered by Respondent No.2 in the context of a due consideration to the Petitioner's contention qua the arrangements between the parties in agreement(s) in question.”

The petitioner contended that it was providing administrative and sales support services to its overseas group entities on a principal-to-principal basis under contractual agreements and receiving consideration in convertible foreign exchange.

It was argued that in the earlier service tax regime, the CESTAT had already held in the petitioner's own case that such services were not intermediary services and qualified as an export of services.

The High Court observed that the authority, while passing the impugned order, had not adequately examined the petitioner's agreements and contentions, particularly the arrangements between the parties in the agreements in question.

Relying on its earlier decisions, the court held that the matter required reconsideration and a proper evaluation of the petitioner's case.

Allowing the petition, the Court quashed the order dated November 19, 2025, and remanded the proceedings for de novo consideration and for passing a fresh order in accordance with law after hearing the parties.

The court directed that the fresh determination be completed within three months and clarified that all contentions of the parties are kept open.

For Petitioner: Advocates Bharat Raichandani along with Advocates Bhagrati instrcuted by. UBR

For Respondent: Addl.G.P. Jyoti Chavan, along with AGP Himanshu Takke