2000 (9) TMI 1015 - AT - VAT and Sales Tax

Summary

Issues:
1. Interest to be paid by the respondent to the applicant.
2. Provision for payment of interest to a dealer for default in refunding the excess amount.
3. Modification of the order for payment of the excess amount within a specified time frame.

Analysis:

Issue 1: Interest to be paid by the respondent to the applicant
The case concerns the question of interest to be paid by the respondent to the applicant. The State Representative highlighted that the assessing officer must adhere to the procedure outlined in an administrative order dated November 20, 1998. It was noted that the law now requires sending a Refund Adjustment Order along with a demand notice, not a Refund Payment Order. The tribunal found that sending the Refund Adjustment Order to the treasury officer instead of the assessee caused unnecessary complications. While the tribunal did not direct personal payment of interest, it emphasized the importance of following statutory rules in future procedures.

Issue 2: Provision for payment of interest to a dealer for default in refunding the excess amount
The tribunal observed that the 1994 Act does not contain a provision for payment of interest to a dealer for delays in refunding excess amounts unless arising from a revision or appeal order. However, as it is mandatory to send the Refund Adjustment Order with the demand notice, the absence of a specific provision for interest does not absolve the respondent from paying interest. The tribunal held that the applicant is entitled to interest as they could have earned from the excess money if refunded promptly. It directed the respondents to pay interest at a rate of 1% per month from the date of the demand notice until payment.

Issue 3: Modification of the order for payment of the excess amount within a specified time frame
The State Representative requested a modification of the order for payment of the excess amount within four weeks from the date of the tribunal's order. The tribunal granted the modification, specifying that the refundable amount should be paid within four weeks from the revised date. The applicant's advocate did not object to this modification. Consequently, the order passed on August 29, 2000, was adjusted to reflect the revised payment timeline.

In conclusion, the application was finally disposed of without any order as to costs, with the tribunal emphasizing the importance of following statutory procedures and directing the payment of interest to the applicant for the delay in refunding the excess amount.