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2016 (9) TMI 1531 - HC - VAT and Sales TaxInterest on refund - Section 42 of the Delhi VAT Act read with Rule 34 (6) of the Rules - It appears that the revenue was informed about the directions, despite which the concerned officer inexplicably has formed the opinion that in the absence of a specific direction, interest upon such refunds is inadmissible. This court is of the opinion that such a view is unwarranted and in fact illegal given the mandate of Section 42 of the Delhi VAT Act read with Rule 34 (6) of the Rules. Revenue is directed to ensure release of interest amounts upon said refund claim in this petition forthwith and ensure that the amount is remitted together with up to date interest, within the next 72 hours - Petition allowed - decided in favor of assessee.
Issues: Refund of excess VAT amount with interest
Analysis: The judgment involves a writ petition seeking a refund of excess VAT amount along with interest. The revenue had released the claimed refund but withheld the interest, prompting the petitioner to approach the court. The court noted that interest on refunds is a matter of right and held that the revenue's opinion of inadmissibility of interest without specific direction is unwarranted and illegal. The court cited Section 42 of the Delhi VAT Act read with Rule 34(6) of the Rules and a previous Division Bench judgment to support its view. Consequently, the revenue was directed to release the interest amount along with the refund within 72 hours. The petitioner was also awarded costs of &8377; 20,000 to be borne by the concerned officer who refused to deposit the interest. The judgment further required the Government of NCT of Delhi to file an action taken report regarding the recovery of amounts from individual officers in similar cases. The court directed the preparation of an appropriate action taken report to be submitted and listed the case for compliance reporting on a specified date. The order was to be served dasti, indicating that a copy of the order would be provided directly to the parties without formal written process.
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