1994 (8) TMI 287 - HC - VAT and Sales Tax

Summary

Issues:
Refund of tax and penalty amount along with incidental charges, withholding of refund under section 33-C of the Act, entitlement of petitioner to refund, power to withhold refund in certain cases, consideration of alleged cost and damages.

Analysis:

Refund of Tax and Penalty:
The petitioner sought a refund of Rs. 34,152, realized towards tax, penalty, and incidental charges by coercive methods. The petitioner, a registered dealer under the Andhra Pradesh General Sales Tax Act, had goods detained and sold following an alleged attempt to evade tax. The Appellate Deputy Commissioner quashed the demand, ordering the refund. The court held that the petitioner was entitled to the refund within two months of the appellate order, as per Rule 35 of the Act.

Withholding of Refund under Section 33-C:
The Government Pleader opposed the petition, citing Section 33-C of the Act, which allows withholding a refund if it may adversely affect revenue due to pending appeals or proceedings. The court clarified that this power could only be exercised in cases where the order giving rise to a refund is under appeal or further proceedings. In this case, as the appellate order was not under any appeal or proceeding, the assessing authority could not withhold the refund based on potential revision proceedings.

Entitlement of Petitioner to Refund:
The court emphasized that the petitioner could not be denied the refund based on the department's contemplation of a revision against the appellate order. It was held that the assessing authority must give effect to the appellate order without waiting for the revision period. Referring to a previous case, the court reiterated that the intention of Rule 35 is for the assessing authority to implement the appellate order promptly.

Consideration of Alleged Cost and Damages:
The court noted that no competent authority or court had issued an order for the payment of an additional amount of Rs. 11,635 towards alleged cost and damages. Therefore, no direction for payment of this amount could be made in the current proceedings under Article 226 of the Constitution.

Conclusion:
The petition partly succeeded, and the court directed the respondents to refund the amount of Rs. 34,152 to the petitioner within fifteen days. The court also ordered the respondents to pay the costs of the petition to the petitioner. The judgment clarified the entitlement to a refund, limitations on withholding refunds, and the implementation of appellate orders without delay.