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TMI Blog2024 (7) TMI 1066X X X X Extracts X X X X X X X X Extracts X X X X ..... lows correction in Form GSTR-1. Correction was made by petitioner on or about 10th July 2018 in Form GSTR-1 for June 2018. 3. Petitioner addressed a communication to proper officer of GST Department, Maharashtra State and Deputy Commissioner of Customs draw back but no refund was granted. This Court, by an order dated 21st April 2023, directed respondent nos. 3 and 4 to consider representation made by petitioner. After considering petitioner's representation, the refund of Rs. 13,20,080/- was granted by Customs Department. The amount of Rs. 7,15,962/- was paid on 18th September 2023 and Rs. 6,04,118/- was paid on 16th October 2023. 4. Mr. Bapat states that petitioner should be paid interest on these amounts from the date it fell due until payment/realisation. 5. Mr. Mishra submitted, relying on an affidavit of one Ayush Goel affirmed on 3rd July 2024, that as the processing and paying the refund amount is automatic, where it is not granted because of technical glitch or non-availability of export details on GSTN Portal and ICEGATE, it cannot be granted by manual intervention. Mr. Mishra also submitted that the delay was not due to department's fault but due to technical glitch b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... #39;it is not the case of interpretation of 132B (4) (b) of the Act or under the said provision, the Courts would restrict obligation and liability of the Revenue to pay interest or compensation up to the date of payment. The question for consideration of the Court raised by Petitioner is whether Respondents can refuse to compensate the Petitioner for wrongfully withholding the cash amount of Petitioner though by the assessment order the liabilities of Petitioner's were declared as NIL beyond the date of the assessment order.' The Court held that Petitioner in that case, where the facts were almost similar to the case at hand, were entitled to compensation'. Paragraphs 32 to 40 read as under: "32. There is no doubt that the said section 132B (4) (b) provides that, interest shall run from the date immediately following the expiry of the period of one hundred and twenty days from the date on which the last of the authorisations for search under section 132 or requisition under section 132A was executed to the date of completion of the assessment under section 153A or under Chapter XIV-B. In our view the said provision does not indicate any bar from awarding payment of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s held that, since the payment was made after the outer limit of the period prescribed under section 132B (4) (b) of the Act, 1961, the Petitioner would be entitled to compensation on account of delay for the subsequent period. The Delhi High Court followed the judgment of the Hon'ble Supreme Court in a case of Sandvik Asia Ltd. (supra) and directed the revenue to pay compensation/damages to the assessee on the balance sum for the subsequent period at the rate of 9% p.a. In our view, the principles laid down by the Delhi High Court in a case of Ajay Gupta (supra) after adverting to the judgment of Sandvik Asia Ltd. (supra) applies to the facts of this case. We are in respectful agreement with the view expressed by the Delhi High Court in the said judgment. 38. The Delhi High Court in a case of G. L. Jain (supra) after adverting to its earlier judgment in case of Ajay Gupta (supra) and judgment of the Hon'ble Supreme Court in case of Sandvik Asia Ltd. (supra) has held that there is no justification in refusing to pay compensation/damages for the delay caused by the respondents revenue in releasing the payment within the time prescribed due and payable to the petitioners a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order on 31st December 2019 under Section 132B of the Act, the Revenue did not consider it fit to process and refund the amount. Even after the Petition was filed and served and the lawyer appeared for the Revenue, still the Revenue did not consider it fit to return the money. Therefore, in our case this is nothing but a clear case of high handedness on the part of the officers of the Revenue." 8. It will also be useful to reproduce paragraphs 37, 38 and 39 of Union of India Vs. Tata Chemicals Ltd. (2014) 43 taxmann.com 240 (SC). "37. A "tax refund" is a refund of taxes when the tax liability is less than the tax paid. As per the old section an assessee was entitled for payment of interest on the amount of taxes refunded pursuant to an order passed under the Act, including the order passed in an appeal. In the present fact scenario, the deductor/assessee had paid taxes pursuant to a special order passed by the assessing officer/Income Tax Officer. In the appeal filed against the said order the assessee has succeeded and a direction is issued by the appellate authority to refund the tax paid. The amount paid by the resident/ deductor was retained by the Government till a dir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terest is payable, since the present case does not fall either under clause (a) or (b) of Section 244A of the Act. In the absence of an express provision as contained in clause (a), it cannot be said that the interest is payable from the 1st of April of the assessment year. Simultaneously, since the said payment is not made pursuant to a notice issued under Section 156 of the Act, Explanation to clause (b) has no application. In such cases, as the opening words of clause (b) specifically referred to "as in any other case", the interest is payable from the date of payment of tax. The sequel of our discussion is the resident/deductor is entitled not only the refund of tax deposited under Section 195 (2) of the Act, but has to be refunded with interest from the date of payment of such tax." 9. Therefore, we direct respondent nos. 3 and 4 to pay interest @6% p.a. from 1st July 2018 upto 18th September 2023 on Rs. 7,15,962/- and upto 16th October 2023 on Rs. 6,04,118/-. 10. The amounts shall be paid within four weeks from the date this order is uploaded. If not paid interest shall be paid on the interest at 9% p.a. upto the date of payment from the date the 4 weeks period would end t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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