2021 (4) TMI 427 - HC - VAT and Sales Tax

Refund of Input tax credit - zero rated sales - rejection on the ground that the Form-W was not filed within 180 days from the date of making zero rated sale - HELD THAT - Section 18(3) of the Tamil Nadu Value Added Tax Act, 2006 states that where the dealer has not adjusted the input tax credit or has not made a claim for refund within a period of 180 days from the date of making zero rated sales accrual of such input tax credit shall lapse to Government. The matter is remitted to the file of the second respondent. The second respondent shall verify the petitioner's Form-I returns filed on monthly basis and also confirm as regards the admissibility and genuinity and if they are found to be in order, the second respondent shall pass appropriate orders for refund - petition allowed by way of remand.

Summary

Issues:
Challenging rejection of refund claim due to delay in filing Form-W within 180 days from zero rated sale.

Analysis:
The petitioner, an exporter engaged in zero-rated sales, filed writ petitions regarding assessment years 2008-09 and 2009-10 for different months. The issue arose when the petitioner failed to file returns in Form-W within the required time frame to claim a refund. Consequently, the refund request was rejected based on this delay. The petitioner then approached the revisional authority, which upheld the original assessment authority's decision, leading to the filing of the writ petitions.

The respondents presented a detailed counter affidavit, emphasizing Section 18(3) of the Tamil Nadu Value Added Tax Act, 2006, which stipulates that if a dealer does not adjust input tax credit or claim a refund within 180 days from the zero-rated sale, the input tax credit lapses to the government. Despite the statutory position favoring the respondents, legal precedent was cited to support the petitioner's case. Previous decisions highlighted that for zero-rated sales related to exports, the timely filing of Form I returns was crucial, and a delay in submitting Form W should not automatically lead to the rejection of a refund claim.

In line with the established legal principles from prior cases, the court ruled in favor of the petitioner. The court allowed the writ petitions, set aside the impugned orders, and remanded the matter to the respondent for verification of the petitioner's Form-I returns filed monthly. The respondent was directed to assess the admissibility and genuineness of the claim and, if found satisfactory, to process the refund accordingly within eight weeks from the date of the court's order. No costs were awarded in this judgment.