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TMI Blog2017 (11) TMI 1298X X X X Extracts X X X X X X X X Extracts X X X X ..... rpreting the provisions relating to refund in the Act. Adjudicating Authorities would thereafter apply the ratio to the factual matrix and decide the issue i.e. the date from which interest is payable. 3. Initially learned counsel for respondent had raised a preliminary objection on the maintainability of the writ petition in view of the alternative remedy, which was contested by the learned counsel for the petitioner. The said contention, however, was later not pressed by the learned counsel for the respondent with the clarification that the respondent would be entitled to raise the said contention in another case, if required and necessary. 4. IJM Corporation Berhad had filed its VAT Return under form DVAT 16 for the month of March, 2012 on 23rd April, 2012 claiming refund of Value Added Tax ('VAT'/Tax) of Rs. 6,38,38,297/-. The petitioner states and claims that interest is due and payable from the date of filing of the Return i.e. 23rd April, 2012 till 3rd October, 2016 when the refund of Rs. 6,38,38,297/- was issued. 5. The case of the respondent authorities is that the petitioner/ IJM Corporation Berhad would be entitled to refund in terms of Section 42(1)(a) of the Act aft ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd was made. (6) The Commissioner shall grant refund within fifteen days from the date the dealer furnishes the security to his satisfaction under sub-section (5). (7) For calculating the period prescribed in clause (a) of sub- section (3), the time taken to - (a) furnish the security under sub-section (5) to the satisfaction of the Commissioner; or (b) furnish the additional information sought under section 59; or (c) furnish returns under section 26 and section 27, shall be excluded. (8) Notwithstanding anything contained in this section, where (a) a registered dealer has sold goods to an unregistered person; and (b) the price charged for the goods includes an amount of tax payable under this Act; (c) the dealer is seeking the refund of this amount or to apply this amount under clause (b) of sub-section (3) of this section; no amount shall be refunded to the dealer or may be applied by the dealer under clause (b) of sub-section (3) of this section unless the Commissioner is satisfied that the dealer has refunded the amount to the purchaser. (9) Where (a) a registered dealer has sold goods to another registered dealer; and (b) the price charged for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... luding any penalty due is wholly reduced, the amount of interest, if any, paid shall be refunded, or if such amount is varied, the interest due shall be calculated accordingly. (4) Where the collection of any amount is stayed by the order of the Appellate Tribunal or any court or any other authority and the order is subsequently vacated, interest shall be payable for any period during which such order remained in operation. (5) The interest payable by a person under this Act may be collected as tax due under this Act and shall be due and payable once the obligation to pay interest has arisen." 8. Sub-Section (1) to Section 38 stipulates that the Commissioner shall refund the amount of tax, penalty, and interest, if any, paid in excess of the amount due from him. Sub-Section (2) empowers the Commissioner to first apply such excess or refund towards recovery of any other amount due under the Act or under the Central Sales Tax Act. Sub-Section (3) is subject to sub-Sections (4) and (5) of Section 38 and provides in clause (i) that the refund payable after adjustment, if any, under sub-Section (2) shall be paid within one month from the date on which the Return was furnished, if ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er the Central Sale Tax Act, 1956. Section 26 of the Act refers to periodical furnishing of returns by every registered dealer i.e. the assessee to the Commissioner for each tax period and by such dates as may be prescribed in the prescribed form and manner. Perhaps reference is made to Section 26 in subsection (7) to Section 38 of the Act, for an assessee/dealer can claim refund vide Form DVAT-21 as prescribed by Rule 34 of the Rules. In clause (d) to sub-section (7) exclusion of time taken to furnish declaration or certificate forms as required under the Central Sale Tax Act, 1956 is prescribed with effect from 18th June, 2012. We are not referring to any other sub-section as reliance is not placed by any of the parties on the said sub-sections. 13. Counsel for the petitioner submits that sub-sections (4) and (5) have been considered and interpreted by a Division Bench of this Court in Swaran Darshan Impex (P) Ltd. Vs. Commissioner, Value Added Tax and Anr., (2010) 31 VST 475 (Delhi). We need not refer to this decision, as the issue raised is these writ petitions, does not specifically relate to interpretation of the said sub-sections. 14. Section 42 relates to interest and s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as under:- "11. Net tax (1) The net tax payable by a dealer for a tax period shall be determined by the formula: Net Tax = O - I - C where O = the amount of tax payable by the person at the rates stipulated in section 4 of this Act in respect of the taxable turnover arising in the tax period, adjusted to take into account any adjustments to the tax payable required by section 8 of this Act. I = the amount of the tax credit arising in the tax period to which the person is entitled under section 9 of this Act, adjusted to take into account any adjustments to the tax credit required by section 10 of this Act. C = the amount, if any, brought forward from the previous tax period under sub-section (2) of this section. (2) Where the net tax of a dealer calculated under sub-section (1) of this section amounts to a negative value, the dealer shall - (a) adjust the said amount in the same tax period against the tax payable by him under the Central Sales Tax Act, 1956 (74 of 1956), if any; and (b) be entitled to claim a refund of any surplus amount and the Commissioner shall deal with the refund claim in the manner described in section 38 and section 39 of this Act. Explan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on which refund is payable by the Revenue need not coincide and could be different as per the statute. 19. The interpretation given by us gets affirmation from Section 39 of the Act, which relates to power to withhold refund in certain cases. Section 39 of the Act reads as under:- "39 Power to withhold refund in certain cases: (1) Where a person is entitled to a refund and any proceeding under this Act, including an audit under section 58 of this Act, is pending against him, and the Commissioner is of the opinion that payment of such refund is likely to adversely affect the revenue and that it may not be possible to recover the amount later, the Commissioner may for reasons to be recorded in writing, either obtain a security equal to the amount to be refunded to the person or withhold the refund till such time the proceeding or the audit has been concluded. (2) Where a refund is withheld under sub-section (1) of this section, the person shall be entitled to interest as provided under sub-section (1) of section 42 of this Act if as a result of the appeal or further proceeding, or any other proceeding he becomes entitled to the refund." Sub-section (1) gives power to the Comm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er for the authorities under the Act to examine each and every case wherein a revised return has been filed and thereafter, determine whether the assessee would be entitled to interest and, if so, from which date, on the findings. We leave the question/issue open. 22. With the consent of the counsel for the parties, it is directed that the authorities will examine the question of interest payable on refund and the date from which it is payable in accordance with the aforesaid dictum and principles. In case of revised return, facts would be examined first and then the issue of the date from which interest is payable would be decided. The said exercise would be completed by the authorities concerned within a period of four months from the date on which a copy of this order is received. We have fixed the aforesaid time period as we perceive and believe, it may take time for both the assessee and the authority to determine and decide in each and every case and the amount of interest payable on refund. We would clarify that starting point or date from which interest commences, has not been modified as the authorities have given four months' time. 23. With the aforesaid observations an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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