Delayed refund voucher attracts interest where the revenue causes unexplained delay in issuing the refund payment.

Where refund is ordered but the refund voucher is issued after an unexplained delay attributable to the revenue, interest is payable under the applicable refund rule. The Punjab and Haryana High Court applied rule 35(1)(a) of the Haryana General Sales Tax Rules, 1975, and rejected the revenue's objection based on the absence of a surety bond and on rule 35(1)(b), which was confined to appellate or revisional orders. The assessee was therefore entitled to interest on the delayed refund at 12% per annum for the relevant period, and the writ petition succeeded.

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Issues: Whether the assessee was entitled to interest on the delayed issue of the refund voucher under rule 35(1)(a) of the Haryana General Sales Tax Rules, 1975.

Analysis: The assessment had been finalised and refund ordered on 18 December 1991, yet the refund voucher was not issued until 4 May 1994. The delay was found to be unexplained and attributable to the revenue authorities. In those circumstances, rule 35(1)(a) was held to govern the claim, and the defence based on absence of surety bond and rule 35(1)(b) was not accepted.

Conclusion: The assessee was held entitled to interest on the delayed refund payment at 12% per annum for the relevant period.

Final Conclusion: The writ petition succeeded and the respondents were directed to pay interest on the delayed refund.

Ratio Decidendi: Where refund is ordered but issuance of the refund voucher is unreasonably delayed by the authority, interest becomes payable under the applicable refund rule notwithstanding the revenue's objection based on surety bond or a provision confined to appellate or revisional orders.

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