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2017 (5) TMI 591 - HC - VAT and Sales TaxInterest on delayed refund - shortfall of interest in the refunds - relevant date for calculation of interest - The difference in the calculation is because the DT&T has worked out the interest only from 5th April 2016 i.e. the date of the dismissal of its SLPs by the Supreme Court - Held that - interest should be paid on the refund amounts due from the date of the making of the claim for refund i.e. 30th April 2013 - the interest due to the Petitioner for both AYs will be re-worked by the DT&T, for the period from 30th April 2013 upto 29th April 2017 - petition allowed - decided in favor of petitioner.
Issues:
- Refund of amounts deposited with the Department of Trade & Taxes (DT&T) for two Assessment Years (AYs). - Calculation and payment of interest on the refunded amounts. Analysis: 1. The petitioner, ABB India Limited, filed writ petitions seeking directions for the refund of amounts deposited with the DT&T for two Assessment Years (AYs) - AY 2005-06 and AY 2006-07. 2. The petitioner had made total pre-deposits of specific amounts for each AY between certain dates. The petitioner succeeded before the court in demonstrating that the demands created by the DT&T for both AYs were unsustainable in law, as decided in a previous judgment dated 28th September 2012. 3. The DT&T had filed Special Leave Petitions (SLPs) in the Supreme Court against the decision favoring the petitioner, but the SLPs were dismissed on 5th April 2016. Subsequently, the petitioner requested refunds with interest from the DT&T, which were the subject of the present controversy. 4. The petitioner, in letters dated 30th April 2013, requested refunds of the deposited amounts along with interest, and also submitted necessary forms to the DT&T. However, a discrepancy arose regarding the interest calculation on the refunded amounts. 5. The dispute centered around the shortfall of interest in the refunds made by the DT&T to the petitioner. The petitioner's calculation showed a higher total amount due as refund, including principal and interest, for both AYs compared to the amounts refunded by the DT&T. 6. The difference in the interest calculation arose because the DT&T had calculated interest only from 5th April 2016, the date of the dismissal of the SLPs by the Supreme Court. However, both parties eventually agreed that interest should be paid on the refund amounts from the date of the refund claim, i.e., 30th April 2013. 7. The court directed the DT&T to rework the interest due to the petitioner for both AYs from 30th April 2013 to 29th April 2017 and to pay the differential amount in respect of both AYs to the petitioner by 30th June 2017. The petitions were disposed of with the provision for the petitioner to seek legal remedies in case of non-compliance with the court's directions.
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