Court orders refund of Rs. 2,96,622 + interest under VAT Act. Ruling impacts connected cases.

The High Court of Gujarat allowed the writ application directing the Respondents to grant a refund of Rs. 2,96,622 along with statutory interest within six weeks from the date of the order under the VAT Act for the year 2013-14. The Court referenced previous decisions to support its ruling and extended the decision to connected writ applications, ensuring uniformity in granting refunds for similar cases.

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Issues:
Refund of excess tax under the VAT Act for the year 2013-14 not processed and paid.

Analysis:
The judgment delivered by the High Court of Gujarat pertains to multiple writ applications with similar issues, which are being heard together and disposed of collectively. The lead matter, Special Civil Application No. 14435 of 2021, is treated as the primary case for reference. The writ applicants sought relief through a writ of mandamus or any appropriate order directing the Respondents to grant a refund of Rs. 2,96,622 due as per self-assessment return under the VAT Act for the year 2013-14, along with interest. The applicants are involved in the business of manufacturing and selling FRP/Wooden Cooling Towers and related parts used in various industries.

The applicants were registered under the Gujarat Value Added Tax Act, 2003, and the Central Sales Tax Act, 1956. They claimed Input Tax Credit under the VAT Act for tax paid on goods purchased from registered dealers. Due to concessional rates under the CST Act for inter-state sales, the Input Tax Credit exceeded the output tax liability, leading to a refund claim in the self-assessment return for the year 2013-14. Despite multiple reminders, the refund remained unprocessed and unpaid, prompting the applicants to approach the Court.

During the hearing, the Court noted that the time limit for assessment and reassessment under the VAT Act had expired without any order passed by the authority. The judgment referenced two previous decisions of the High Court, namely Malhotra Graphics Thr. Sanjay Malhotra vs. State of Gujarat & Anr. and Torrent Power Ltd. vs. State of Gujarat, to support the decision. In light of the circumstances and legal precedents, the Court allowed the writ application directing the Respondents to grant the refund of Rs. 2,96,622 along with statutory interest within six weeks from the date of the order. The decision in the lead matter was extended to connected writ applications, ensuring compliance across all related cases.

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