2015 (12) TMI 181 - HC - VAT and Sales Tax

Refund of the excess ITC - no refund was made within 60 days - claim of interest on delayed refund - Provisional refund - Held that - After hearing learned counsel for the petitioner, perusing the present petition and without expressing any opinion on the merits of the case, Court dispose of the present petition by directing respondent No.4 to decide the applications dated 28.1.2015 and dated 21.8.2015, in accordance with law by passing a speaking order and after affording an opportunity of hearing to the petitioner within a period of one month from the date of receipt of certified copy of the order. It is further directed that in case any amount is found payable to the petitioner, the same be released to it within next one month, in accordance with law. - Appeal disposed of.

Summary

Issues:
Refund of excess Input Tax Credit (ITC) under Punjab Value Added Tax Act, 2005.

Analysis:
The petitioner, a partnership firm engaged in construction activities, sought a writ of mandamus for the refund of excess ITC as per an order passed by respondent No.2. The petitioner, registered under the Punjab Value Added Tax Act, filed applications for provisional refund based on quarterly VAT returns. Despite the statutory requirement of issuing refunds within sixty days, no refund was provided within the stipulated time. An assessment was conducted, determining an amount as excess ITC refundable to the petitioner. Subsequently, an appeal was filed against the assessment order, which was partly allowed. The petitioner then requested refunds with interest under Section 40 of the Act through applications, but no action was taken. The court, without delving into the merits, directed respondent No.4 to decide on the pending applications within a month, following due process and providing an opportunity for the petitioner to be heard. If any amount is found payable, it should be released within the subsequent month, complying with the law.

This judgment primarily revolves around the petitioner's entitlement to the refund of excess Input Tax Credit (ITC) under the Punjab Value Added Tax Act, 2005. The petitioner, a partnership firm engaged in construction activities, had filed applications for provisional refunds based on their VAT returns but faced delays in receiving the refunds within the stipulated timeframe. Despite an assessment determining the excess ITC refundable to the petitioner, no interest under Section 40 of the Act was paid initially. The petitioner's subsequent appeal partially succeeded, leading to requests for refunds with interest, which remained unaddressed. The court's directive to respondent No.4 to adjudicate on the pending refund applications within a month, ensuring a fair hearing for the petitioner, and releasing any payable amount within the subsequent month, aims to uphold the statutory provisions and provide timely relief to the petitioner in accordance with the law.