2011 (10) TMI 562 - HC - VAT and Sales Tax

Summary

Issues:
1. Writ petitions filed seeking mandamus for refund of disputed tax amounts during pending appeals.
2. Failure of the assessing authority to refund the tax amounts and the entitlement to interest.
3. Interpretation of statutory provisions regarding the obligation to refund tax amounts.
4. Application of principles of delay and laches in filing writ petitions for refund.

Analysis:

1. The writ petitions were filed by the petitioner, a registered dealer, seeking a writ of mandamus for the refund of disputed tax amounts paid during the pendency of appeals for various assessment years. The petitioner contended that the assessing authority failed to pass consequential orders within the stipulated time after remand by the appellate authority, resulting in the non-refund of the tax amounts. The court noted that while the petitioner's claim for refund was justified due to the assessing authority's default, substantial arrears of tax were still due from the petitioner.

2. The petitioner argued that under section 33B of the APGST Act, the assessing authority had a statutory obligation to refund the amount due to the assessee and claimed interest on the refund amount. Citing a previous case, the petitioner sought interest at 12% per annum on the unrecovered tax amounts. However, the court deliberated on whether the petitioner could maintain the writ petitions for refund and interest after a significant lapse of time, ultimately concluding that discretionary relief in the form of mandamus was not warranted in this case.

3. The court analyzed the statutory provisions regarding the obligation to refund tax amounts, emphasizing the phrase "any amount becomes due to the assessee" in section 33B of the APGST Act. Drawing parallels from a Kerala Revenue Recovery Act case, the court highlighted that a claim that is time-barred cannot be considered an amount due for recovery. The court further referenced a case involving the A.P. State Financial Corporation, where recovery proceedings were challenged based on limitation grounds, reinforcing the principle that recovery actions cannot be pursued for amounts barred by limitation.

4. Regarding the delay and laches in filing the writ petitions for refund, the court noted a significant delay in approaching the assessing officer or the court. Citing legal precedent, the court held that the petitioner's cause of action should have arisen promptly after the expiry of the stipulated period for making representations. Ultimately, the court deemed the writ petitions as barred by delay and laches, emphasizing that cases involving refund of tax amounts carry larger public interest implications. Consequently, the court dismissed the writ petitions, highlighting the importance of public interest and the discretion of the court in such matters.