9911796707
TMI Blog1995 (11) TMI 401X X X X Extracts X X X X X X X X Extracts X X X X ..... sh General Sales Tax Act read with section 5(3) of the Central Sales Tax Act. It is not in dispute that as a result of the petitioner succeeding in the appeal, a sum of Rs. 85,735 collected towards tax is refundable. The petitioner made an application for the refund of amount on April 6, 1994, followed by reminders on April 13, 1994 and November 10, 1994, though under the relevant provision, which we would refer to hereafter, no application need be made. By a communication, dated November 30, 1994, the Commercial Tax Officer, Kakinada, informed the petitioner that he did not the records from the office of State Representative of Sales Tax Appellate Tribunal and that the revised assessment orders will be passed soon after the receipt of the files. As there was no response, the petitioner again submitted a representation on January 30, 1995, to which the Commercial Tax Officer sent a communication, dated February 22, 1995, which reads as follows: "With reference to the letter cited M/s. Coromandel Fisheries Private Ltd., Kakinada are hereby informed, that I am of the opinion that the grant of refund is likely to adversely affect the Revenue. I, therefore, withhold the refund till t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the previous approval of the Deputy Commissioner, withhold the refund till such time as the Deputy Commissioner may determine." There are three ingredients in section 33-C which are to be satisfied before the claim for refund is rescinded by the department: (1) that the order giving rise to refund is the subject-matter of an appeal or further proceeding or any other proceeding under the Act is pending; (2) the assessing authority must form an opinion that the grant of refund is likely to adversely affect the revenue; and (3) the previous approval of the Deputy Commissioner is required to be taken by the assessing authority for withholding the refund. These conditions are cumulative. The first and foremost requirement is the pendency of an appeal or further proceeding in relation to the order giving rise to refund or the pendency of any other proceeding under the Act in relation to the said order. We are unable to say that this requirement is satisfied in the instant case so as to justify the denial of refund under section 33-C of the Act. The circumstances under which the order withholding the refund came to be passed on February 22, 1995, are explained in para 3 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... resentative because, according to the information furnished by the State Representative, steps were being taken to file tax revision case. Thus, even assuming that the copy of the order has not been received by the Commercial Tax Officer, the receipt of the order by the State Representative is as good as receipt of the order by the assessing authority. Moreover, if the order of the Tribunal had not been received by the assessing authority and if he is unaware of the said order, it is ununderstandable as to how he could pass an order withholding refund on the ground that it would adversely affect the interests of the Revenue even without going through the appellate order of the Tribunal. It only shows that there was non-application of mind on the part of the assessing authority. On this ground alone, the order dated February 22, 1995, is liable to be quashed. Another formidable obstacle in sustaining the action of the assessing authority in withholding the refund in purported exercise of power under section 33-C of the Act is that there is no proof to the effect that the appellate order of the Tribunal is the subject-matter of any further proceeding, such as revision petition filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment proceedings on the ground that the proposed refund would adversely affect the interest of the Revenue, such action cannot be faulted. We are, therefore, of the view that the decision in Sarvaraya Textiles Ltd. [1991] 82 STC 367 (AP); (1990) 11 APSTJ 251 is distinguishable. In the light of the above discussion, we quash the order dated February 22, 1995, passed by the Commercial Tax Officer, Kakinada, withholding the refund and his further communication dated May 20, 1995, informing the petitioner that the refund was withheld pursuant to the directive given by the Deputy Commissioner. But, this is not the end of the matter. The mere fact that we have quashed the order withholding the refund does not per se entitle the petitioner to get the refund. The petitioner's entitlement to refund depends upon the satisfaction of the requirements of section 33-BB of the Act, which lays down as follows: "33-BB. Non-refund of tax in certain cases.-Where a levy and collection of tax is held invalid by any judgment or order of a court or Tribunal, it shall not be necessary to refund any such tax to the dealer unless it is proved by the dealer to the satisfaction of the assessing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay be the actual exporter or foreign buyer. As the question involved under section 33-BB of the Act is essentially a question of fact or at least a mixed question of law and fact, it is not appropriate for us to decide that question especially in the absence of any material placed before us pro or contra. We, therefore, feel that the proper course would be to direct the assessing authority to make an enquiry in terms of section 33-BB of the Act and to determine whether the dealer has adduced satisfactory proof to the effect that the tax had not been passed on to the purchaser. In the result, we declare that the action of the Commercial Tax Officer in withholding the refund in purported exercise of power under section 33-C of the Act is arbitrary and illegal by quashing the proceedings of the 2nd respondent dated February 22, 1995 and May 20, 1995. At the same time, we direct the Commercial Tax Officer to hold an enquiry in terms of section 33-BB of the Act as directed in the preceding para. Such enquiry shall be completed within a period of two months from the date of receipt of this judgment. The writ petition is allowed to the extent indicated above. No costs. Writ petiti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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