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TMI Blog2020 (8) TMI 222X X X X Extracts X X X X X X X X Extracts X X X X ..... the petitioners and the petitioners produce the requisite documents/forms before the respondent authorities, the respondent authorities are required to process such claim within twelve weeks of the same being made in writing by the petitioners. The respondents are directed to forthwith process the refund claim of the writ applicant and grant the refund of the tax amount collected from the writ applicant and deposited by the seller in accordance with law within a period of twelve weeks of the receipt of a copy of this judgment - Application allowed. - R/SPECIAL CIVIL APPLICATION NO. 8870 of 2020 - - - Dated:- 31-7-2020 - HONOURABLE THE CHIEF JUSTICE MR. VIKRAM NATH AND HONOURABLE MR. JUSTICE J.B.PARDIWALA Appearance: UCHIT N SHETH(7336) for the Petitioner(s) No. 1 for the Respondent(s) No. 1,2,3 ORAL JUDGMENT (PER : HONOURABLE MR. JUSTICE J.B.PARDIWALA) 1. By this writ application under Article 226 of the Constitution of India, the writ applicant, a Public Limited Company, having its place of business at Rajasthan, has prayed for the following reliefs; (A) This Hon'ble Court may be pleased to issue a writ of mandamus or a writ in na ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petrol, diesel, aviation turbine fuel, natural gas and alcoholic liquor. These 6 commodities continued to be governed by the respective State value added tax laws for the transactions within the State as well as the CST Act in so far as inter-State transactions were concerned. Despite the fact that diesel continued to come within the ambit of the CST Act, the authorities in the State of Rajasthan refused to issue C form declarations for purchase of diesel at concessional rate after 1.7.2017 on the ground that after introduction of the GST regime the registration certificates of the dealers such as the Petitioner automatically stood cancelled and they were not eligible for making purchases of diesel against C form declarations. In view of such stand taken by the authorities of the State of Rajasthan, the seller started raising invoice on the seller charging full tax at the rate of 20% on sales of diesel to the Petitioner. Copy of sample invoice of the seller in respect of sale of diesel to the Petitioner is annexed herewith and marked as Annexure B. Since the authorities of the State of Rajasthan were not heeding the request of the Petitioner as well as other similarl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and deposited during the interregnum period however still survived. On the basis of the judgement so passed by Hon. Rajasthan High Court the seller i.e. Reliance Industries Ltd. intimated the learned Respondent authorities of the State of Gujarat regarding the issue as well as the direction given by Hon. High Court to refund the excess amount collected by the concerned authorities. The seller informed that its various buyers of the State of Rajasthan would approach the authority for refund. Copy of letter dated 25.7.2018 by the seller to the learned Respondent authorities is annexed herewith and marked as Annexure E. Pursuant to directions of Hon. Rajasthan High the learned authorities of the State of Rajasthan issued C form declarations to the Petitioner for purchases of diesel made from 1.10.2017 to 31.3.2018 on 28.1.2019. Copies of C form declarations issued by the Rajasthan authority are collectively annexed herewith and marked as Annexure F. The Petitioner addressed email communications to the seller requesting him for obtaining refund from the Gujarat Value Added Tax department on the basis of order of Hon. Rajasthan High Court and the C form declarations. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hin 12 weeks of the refund claim. The Petitioner says that the entire situation arose because of the illegal stand taken by the learned authorities of the State of Rajasthan denying issuance of C form declarations to the Petitioner for purchase of diesel after introduction of the GST regime. Despite the fact that the Petitioner was legally entitled to purchase goods at concessional rate of tax against C form declarations, due to the illegal stand taken by the Rajasthan authorities the Petitioner was forced to make purchases by paying CST at the rate of 20% instead of 2%. Such tax was deposited by the seller with the learned Respondent authorities in the State of Gujarat. The Petitioner therefore approached Hon. Rajasthan High Court which was pleased to issue direction to the Rajasthan authorities to issue C form declarations and also a direction to the concerned authorities who had collected excess tax to refund such amount. Despite such specific direction given by Hon. Rajasthan High Court and despite the fact that the Petitioner was in fact not required to make payment of such tax in the first place and the payment was made only because of misinterpretation of law by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Reliance Industries Ltd. is required to be refunded. However, the stance of the respondents herein is that such refund can be made to the seller, i.e. the Reliance Industries Ltd. after its assessment for the period in question is concluded and not to the writ applicant who is not registered as the dealer in the State of Gujarat. 5. Having heard the learned counsel appearing for the parties and having gone through the materials on record, we take notice of the fact that the issue raised in the present litigation is squarely covered by a decision of a Coordinate Bench of this Court in the case of J.K. Cement Ltd. vs. State of Gujarat, Special Civil Application No.15333 of 2019 decided on 18th December, 2019 . We quote the relevant observations made in the said judgment; 11. Mr. Uchit Sheth, learned advocate for the petitioners in both the petitions, submitted that the respondent authorities have erred in refusing to refund the amount of excess tax collected and deposited with them even though C form declarations in respect of such transactions have been duly furnished and the Rajasthan High Court has specifically directed the concerned authorities to refund the excess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lal Industries Ltd. v. Union of India, 111 STC 467 (SC), wherein the court has held thus: 99.(xii) Section 11-B does provide for the purchaser making the claim for refund provided he is able to establish that he has not passed on the burden to another person. It, therefore, cannot be said that section 11-B is a device to retain the illegally collected taxes by the State. This is equally true to section 27 of the Customs Act, 1962. It was submitted that therefore, if the purchaser can show that he has borne the burden of the tax, he can still be given refund. It was submitted that the petitioners having borne the burden of the tax, they are entitled to refund thereof. 11.3 Reference was made to sub-section (3) of section 31 of the Gujarat Value Added Tax Act, 2003 (hereinafter referred to as the GVAT Act ), which provides that the tax collected and deposited under the provisions of the Act to which a dealer may be held not liable shall not be refunded to the dealer and the amount of such tax shall stand forfeited to the Government. Referring to section 36 of the GVAT Act, which deals with refund of excess payment and says that subject to the other provisions of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e service tax which was paid as per the law prevailing at the relevant time, but which became refundable on account of retrospective amendment in the law. The CPWD instead of applying for refund, itself insisted that the petitioner must apply and when the petitioner's application for refund was rejected by the Assistant Commissioner of Service Tax, Ajmer, CPWD found a novel way to recover the same from the petitioner by utilizing the petitioner's security deposit, unpaid amounts of final bill and the petitioner's running bills of other contracts. These are wholly impermissible means of recovery. 15. The petitioner as a service provider was basically not even required to bear the service tax burden, as duty was to be collected from the service recipient and to be deposited with the Government revenue, if the service tax was payable. If the amount was refunded by the Service-tax Department, it was the duty of the petitioner to ensure that the same reaches the service recipient. If, however for whatever reason, the refund is not granted, surely the petitioner cannot be asked to bear the burden thereof. Strangely, the service tax department holds that if the refund is grant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e amount from the State and accordingly, allowed the petition and directed the respondent authorities to refund the amount to the petitioner within the period stipulated therein. It was, accordingly, urged that it is always permissible for this court to direct the respondents to make the payment to the petitioners. 11.7 It was submitted that in the present case, the enactment concerned is the CST Act and the petitioners are dealers under the CST Act, but registered in Rajasthan where they are doing business. It was submitted that it is, therefore, incorrect to say that the petitioners are not dealers. It was submitted that in this case, the petitioners are seeking refund under the CST Act and not under the GVAT Act and that the provisions of the GVAT Act are borrowed only for the procedural aspect. It was, accordingly, urged that the petitions deserve to be allowed by granting the reliefs as prayed for therein. 12. Opposing the petitions, Ms. Maithili Mehta, learned Assistant Government Pleader, submitted that while the respondents are not disputing the fact that the amount collected towards tax in the absence of C form declarations is required to be refunded if the C for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assing the duty burden does not arise and that in the light of the decision of the Rajasthan High Court, the court may issue appropriate directions to the respondent authorities to refund the amount to the petitioners. 14. In the backdrop of the facts and contentions noted hereinabove, it is an undisputed position that the petitioners have borne the burden of tax as the CST authorities at Rajasthan had refused to issue C forms after the coming into force of the GST regime. On account of non-issuance of C forms, the petitioners were not in a position to submit C form declarations in respect of the diesel purchased by them for their mining activity, as a result whereof, the petitioners could not purchase diesel at concessional rate of tax from the seller - Reliance Industries Limited, which collected tax at the rate of 20% from the petitioners and deposited the same with the respondent authorities. Now, on account of the directions issued by the Rajasthan High Court in the decisions referred to hereinabove, the CST authorities at Rajasthan have issued C form declarations in respect of the transactions in question. The respondent authorities do not dispute that against the C form ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore the respondent authorities, the respondent authorities are required to process such claim within twelve weeks of the same being made in writing by the petitioners. 18. Pursuant to the above order passed by the Rajasthan High Court, the petitioner in Special Civil Application No.15333 of 2019 has made an application dated 19.4.2019 to the second respondent for refund of ₹ 2,12,09,162/- charged by Reliance Industries Limited. Along with the application, the petitioner has furnished a copy of the order of the Rajasthan High Court, a statement showing the details of high speed diesel purchases, Form 'C' Quarter IIIrd and IVth (F.Y. 2017-18), copy of the letter from Reliance Industries Limited to the Deputy Commissioner of Gujarat Sales Tax and copy of sample invoice. The petitioner in Special Civil Application No.16288 of 2019 has made an application dated 31.8.2019 to the second respondent seeking refund of ₹ 1,97,32,644/-. Along with such application, the said petitioner has furnished a statement showing details of purchases, tax charged and submission of C forms against such purchases as well as copy of sample invoice, etc. Thus, the petitioners had du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amount and has enclosed therewith Customer-wise details of inter-state sales made to buyers in Rajasthan at full rate, it is evident that Reliance Industries Limited is not disputing the fact that it is the petitioners who are entitled to claim the refund. Under the circumstances, the respondent authorities are not justified in not processing the refund claims of the petitioners. 20. In case of the petitioners, it is an admitted position that the HSD has been purchased by them from Reliance Industries Limited in the course of inter-State trade for use in mining activities and they are, therefore, the ultimate consumers thereof and hence, the question of passing on the tax burden to anyone would not arise. Consequently, the question of unjust enrichment would also not arise. 21. For the foregoing reasons, the petitions succeed and are accordingly allowed. The respondents are directed to forthwith process the refund claims of the respective petitioners and grant refund of the tax amount collected from the petitioners and deposited by the seller in accordance with law within a period of twelve weeks of the receipt of a copy of this judgment. It is, however, clarified that o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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