2023 (12) TMI 742 - HC - VAT and Sales Tax

Refund of excess tax alongwith interest - Power to re-quantification or re-adjudication after the sanction of refund - it is contended that in spite of refunding the excess amount in terms of the order dated 22.09.2022, the refund Officer had issued the said impugned notice beyond his jurisdiction - HELD THAT - It appears that the refund order was passed on 22.09.2022 whereby the 1st respondent had determined the excess tax amount available with them to an extent of a sum of Rs.2,06,22,234/-. Pursuant to the said refund order, the petitioner had filed a refund application before the 1st respondent. At this juncture, the respondent had once again issued a notice to the petitioner and called for the particulars, as if, he is going to revise his own order. As far as the 1st respondent is concerned, he has already assessed the excess tax amount and passed the refund order dated 22.09.2022. Having passed the same, the 1st respondent cannot issue the impugned notice dated 24.01.2023 without any provision of the law much less in terms of the Section 42(5) of the Act, and thereby the petitioner is entitled for the refund - there is no doubt that the first respondent had issued the said notice beyond the scope of his jurisdiction, since in the course of processing of the refund application, the 1st respondent is not empowered to re-adjudicate or re-quantify while passing the refund order. This Court is inclined to direct the 1st and the 2nd respondent to refund the excess tax amount lying with the department to an extent of a sum of Rs.2,06,22,234/- along with interest as per the refund order in CST No.50806/2013-14 dated 22.09.2022. The said exercise is directed to be completed on or before 05.12.2023. Post this matter on 08.12.2023 under the caption 'for reporting compliance'.

Summary

Issues involved:
The issues involved in the judgment are the refund of excess tax amount, jurisdiction of the refund officer, and compliance with the refund order.

Refund of Excess Tax Amount:
The Writ Petitions were filed to seek a direction for the refund of the excess tax amount of Rs.2,06,22,234/- along with interest, as per the assessment and refund order. The petitioner contended that the refund order was issued for the assessment year 2013-2014, determining the excess tax amount, and an application for refund was made. However, instead of granting the refund, an impugned notice was issued by the respondent, calling for details to re-determine the refund order. The petitioner argued that once a refund order is issued, the officer is not entitled to re-quantify the refund, and any defect should be rectified through a re-assessment or revision order. The petitioner filed the writ petition as the refund officer issued the notice beyond his jurisdiction.

Jurisdiction of the Refund Officer:
The petitioner contended that the refund officer, after passing the refund order, cannot issue a notice to re-determine the refund without any provision of the law, especially under Section 42(5) of the Act. The Court observed that the refund officer had already assessed the excess tax amount and passed the refund order, and therefore, issuing the impugned notice was beyond the scope of his jurisdiction. The Court directed the respondents to refund the excess tax amount as per the refund order dated 22.09.2022, along with interest, by a specified date.

Compliance with the Refund Order:
The Court noted that the respondents claimed to be in the process of refunding the excess tax amount but had not taken effective steps until the date of the judgment. Consequently, the Court directed the respondents to complete the refund process by a specified date and scheduled a follow-up hearing for compliance reporting. In case of non-compliance, the respondents were directed to appear before the Court and provide reasons for the same.