1991 (8) TMI 316 - HC - VAT and Sales Tax

Summary

Issues:
1. Refund of tax amount under the Haryana General Sales Tax Act and Central Sales Tax Act.
2. Legality of withholding refund under section 44 of the Act.
3. Constitutional validity of section 44 of the Act.

Analysis:
The petitioner, a private limited company, appealed against the assessment made by the Deputy Excise and Taxation Commissioner, Rohtak, under the Haryana General Sales Tax Act and Central Sales Tax Act. The Sales Tax Tribunal allowed all the appeals, leading to the petitioner seeking a refund of the tax amounts paid. However, the Excise and Taxation Commissioner withheld the refund of Rs. 16,61,802.80 citing pending proceedings and potential adverse effects on recovery. The petitioner challenged this withholding through a writ petition.

The main contention revolved around the legality of withholding the refund under section 44 of the Act. The petitioner argued that section 44 was ultra vires of the Constitution and that the order staying the refund was passed without proper hearing, contending that the refund could not be stayed under section 44. The District Attorney contested the petitioner's claim.

The judgment highlighted that upon allowing the appeals, the authorities were obligated to refund the tax amount as per the provisions of the Act. Section 42 of the Act addressed references against Tribunal orders, emphasizing that the payment of tax due should not be stayed pending disposal of applications or references. The judgment referenced a Division Bench decision to support the petitioner's entitlement to the refund upon setting aside the liability orders. The court ruled in favor of the petitioner, directing the respondents to refund Rs. 16,61,802.80 along with statutory interest. The court also awarded costs to the petitioner.

The judgment concluded by emphasizing the petitioner's entitlement to the refund and interest, dismissing the need to delve into other contentions raised. It clarified that the authorities could claim the refunded amount back if rectification was allowed in accordance with the law. The court allowed the writ petition, granting relief to the petitioner and ordering the refund and interest payment, along with costs.