2019 (1) TMI 811 - HC - VAT and Sales Tax

Refund of the pre-deposit amount - appeal was allowed and the assessment periods in question were remitted for reconsideration in a fresh assessment by the OHA/FAA - Held that - The Court is of the opinion that the principles spelt out in Suvidhe 1996 (8) TMI 521 - SUPREME COURT , as applied in MRF 2018 (8) TMI 995 - DELHI HIGH COURT , squarely apply to the present case - The respondents are hereby directed to ascertain and calculate the amounts which the petitioner is entitled to along with interest, as applicable under the Delhi VAT Act, from the date of decision of the OHA/FAA and refund these amounts to the petitioner, within eight weeks from today - petition allowed.

Summary

Issues:
Refund of pre-deposit amount made during appeal before Objection Hearing Authority (OHA)/First Appellate Authority (FAA) - Retention of deposited amounts by Delhi VAT authorities - Applicability of tax law principles - Calculation of refund with interest under Delhi VAT Act.

Analysis:

The judgment delivered by the Delhi High Court pertains to a petition seeking a refund of a pre-deposit amount of ?97,83,000 made by the petitioner during the pendency of an appeal before the Objection Hearing Authority (OHA)/First Appellate Authority (FAA). The appeal was allowed, leading to the remittance of the assessment periods for reconsideration in a fresh assessment by the OHA/FAA. The petitioner argued that the Delhi VAT authorities should not be allowed to retain the deposited amounts, as they did not qualify as tax under the law. The petitioner cited various court decisions, including those of the Supreme Court, to support their claim. The Court acknowledged that the amounts were indeed pre-deposits made for the hearing of the appeal on merits, and found that the principles laid down in previous Supreme Court cases, as applied in a recent ruling by the Court, were applicable in the present case.

The Court directed the respondents to calculate the amounts due to the petitioner, including any applicable interest under the Delhi VAT Act, from the date of the OHA/FAA decision. The respondents were instructed to refund these amounts to the petitioner within eight weeks from the date of the judgment. The writ petition was allowed in favor of the petitioner, and any pending applications were also disposed of accordingly. The judgment underscores the importance of adhering to legal principles in matters of refund and the obligation of authorities to refund pre-deposit amounts when they do not qualify as tax under the law, as determined by relevant court decisions.