1990 (8) TMI 360 - HC - VAT and Sales Tax

Summary

Issues Involved:
1. Entitlement to refund of Rs. 30,75,300.50 collected as Central sales tax for the years 1982-83 and 1983-84.
2. Legality and jurisdiction of withholding the refund under section 33-C of the A.P. General Sales Tax Act, 1957.

Issue-Wise Detailed Analysis:

Entitlement to Refund:
The petitioner sought a direction for the refund of Rs. 30,75,300.50 collected as Central sales tax for the years 1982-83 and 1983-84. The Sales Tax Appellate Tribunal, Andhra Pradesh, Hyderabad, had set aside the assessment orders for these years and remanded the matter to the assessing authority for fresh disposal. Consequently, the refund of the sales tax amount became due to the petitioner without the need for any claim, as per section 33-B of the A.P. General Sales Tax Act, 1957. Despite representations made by the petitioner on April 14, 1989, and a reminder on July 15, 1989, the respondents did not respond, leading to the filing of W.P. No. 12663 of 1989.

Legality and Jurisdiction of Withholding Refund:
The respondents admitted that the appeals were allowed and the matters were remanded for fresh disposal. However, they invoked section 33-C of the Act, permitting the Commercial Tax Officer to withhold the refund, arguing that it would adversely affect the State revenue. The petitioner contended that the conditions precedent for invoking section 33-C were not met, as the order was issued by the second respondent, not the assessing authority, and lacked proper authority and jurisdiction.

The court examined the relevant provisions:
- Section 33-B mandates automatic refund without any claim if an appellate order results in a refund.
- Section 33-C allows withholding the refund if it adversely affects revenue, but requires the assessing authority's opinion and prior approval from the Deputy Commissioner.

The court found that the assessing authority had indeed formed the opinion that the refund would adversely affect revenue and sought prior approval from the second respondent. The second respondent granted approval on October 31, 1989, and the assessing authority issued the order withholding the refund on November 6, 1989. This process was in compliance with section 33-C.

Conclusion:
The court concluded that the withholding of the refund was in accordance with section 33-C of the Act. The writ petitions lacked substance, and the court could not issue any direction for the refund as prayed by the petitioner. However, considering the prolonged proceedings and the significant amount involved, the court directed the respondents to complete the assessments for the years 1982-83 and 1983-84 within three months from the date of receipt of the order. Failing this, the respondents were to refund the amount with interest as provided under the Act. The writ petitions were dismissed with no costs, and an advocate's fee of Rs. 250 was set for each case.