1993 (8) TMI 272 - HC - VAT and Sales Tax

Summary

Issues:
1. Failure to pass consequential orders and refund by the respondent after the Tribunal's decision.
2. Duty of the respondent to make a refund with interest.
3. Argument regarding winding up of petitioner's business and the department's request for security.
4. Permissibility of the department to obtain a stay of refund under section 39-A of the Act.

Analysis:
The petitioner, a registered dealer under the Tamil Nadu General Sales Tax Act, challenged the respondent's failure to pass consequential orders and refund after the Tribunal's decision for the assessment year 1986-87. The petitioner sought a writ of mandamus for the respondent to comply with the Tribunal's order and refund a specific amount. The petitioner argued that the respondent's inaction disregarded the statutory provisions under rule 32 and section 24(4) of the Act, which mandated the passing of consequential orders and refunds within 90 days to avoid interest payment. The respondent's delay in issuing the refund prompted the petitioner to seek court intervention.

The court noted that the statutory provisions clearly obligated the respondent to pass consequential orders and refunds promptly after the Tribunal's decision. The court rejected the government advocate's argument that the petitioner's business winding up justified delaying the refund pending potential tax revision success by the department. The court emphasized that section 39-A of the Act allowed the department to seek a stay of refund through proper channels, which had not been done in this case. Consequently, the court found no legal basis to withhold the refund and directed the respondent to refund the amount requested by the petitioner with 12% interest per annum within four weeks.

In conclusion, the court disposed of the writ petition in favor of the petitioner, ordering the respondent to make the refund with interest as requested. The court declined to award costs in the circumstances of the case, bringing an end to the legal dispute regarding the failure to pass consequential orders and refund by the respondent after the Tribunal's decision for the assessment year in question.