No Refund Without Mandatory Notice Under Section 74(8) of DVAT Act, Claims Denied with Interest

The HC held that the petitioner is not entitled to a refund of Rs. 14,12,185/- with interest as the mandatory notice under Section 74(8) of the DVAT Act was not served, which is a prerequisite for invoking the deeming provisions under Section 74(9). The mere lapse of time for the OHA to pass an order does not automatically entitle the petitioner to a refund. The court directed the OHA to pass an appropriate order in compliance with the Tribunal's earlier directions expeditiously. The petitioner remains free to issue the required notice under Section 74(8). The petition was disposed of accordingly.

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Issues Involved:
1. Entitlement to refund of Rs. 14,12,185/- along with interest under Section 42 of the DVAT Act.
2. Validity of default assessments for the years 2014-15 and 2016-17.
3. Compliance with the remand order by the Tribunal.
4. Applicability of Section 34(2) and Section 74 of the DVAT Act.
5. Triggering of the deeming provision under Section 74(9) of the DVAT Act.

Issue-wise Detailed Analysis:

1. Entitlement to Refund:
The petitioner filed a VAT return for the quarter 01.04.2017 to 30.06.2017, claiming a refund of Rs. 14,12,185/-. The AO did not accept this return and issued default assessments for 2014-15 and 2016-17. The petitioner's objections to these assessments were dismissed by the OHA. The Tribunal later remanded the matter back to the OHA for reconsideration. The petitioner claims entitlement to the refund as the OHA has not passed any order within the stipulated time. However, the court held that the petitioner's prayer for refund cannot be acceded to at this stage due to the pending decision by the OHA.

2. Validity of Default Assessments:
The AO issued default assessments for the years 2014-15 and 2016-17. The petitioner objected to these assessments, but the objections were dismissed by the OHA. The Tribunal remanded the matter back to the OHA, which has yet to pass a new order. The court noted that the default assessments have not been set aside, and the OHA is required to decide the objections afresh.

3. Compliance with the Remand Order:
The Tribunal remanded the matter to the OHA to reconsider the petitioner's objections with relevant documents. The OHA has not yet complied with this order. The court directed the OHA to pass an appropriate order in compliance with the Tribunal's remand order as expeditiously as possible.

4. Applicability of Section 34(2) and Section 74 of the DVAT Act:
The petitioner argued that the OHA's failure to pass an order within one year should result in the objections being deemed allowed. The court clarified that Section 34(2) applies to assessments required to be made in consequence of a Tribunal or court decision, which is not the case here. Instead, the provisions of Section 74 apply, which mandate that the OHA must pass an order within the prescribed time. However, the failure to pass an order within this time does not automatically allow the objections unless specific conditions under Section 74(8) and 74(9) are met.

5. Triggering of the Deeming Provision under Section 74(9):
The petitioner did not serve a notice under Section 74(8) of the DVAT Act, which is a prerequisite for triggering the deeming provision under Section 74(9). The court held that without this notice, the objections cannot be deemed allowed. The court emphasized the mandatory nature of issuing a notice under Section 74(8) to trigger the deeming provision.

Conclusion:
The court concluded that the petitioner's request for a refund cannot be granted at this stage. The OHA is directed to pass an appropriate order in compliance with the Tribunal's remand order. The petitioner is not precluded from issuing a notice under Section 74(8) to trigger the deeming provision. The petition and any pending applications were disposed of accordingly.

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