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of <h1>Entitlement to interest on delayed tax refund under statutory scheme: interest awarded from due date at six percent.</h1> Entitlement to interest on delayed tax refund under the statutory refund scheme was considered; court applied precedent and statutory mandate to hold that ... Entitlement to interest on delayed refund - refund of tax under the statutory scheme - duty to issue notice and upload assessment orders - remand for fresh adjudication by assessing authority - Computation of interest from date refund became due - appellate scrutiny of limitation and service - High Court writ jurisdiction - Section 38(3)(a)(ii) of the Delhi Value Added Tax Act, 2004 - HELD THAT:- The interest shall be calculated till the tax was refunded to the petitioner which in this case is 15th January 2025. In support of the aforesaid finding recorded by this Court qua the entitlement of the petitioner for interest on the refunded amount of Value Added Tax, reliance is rightly placed on the judgment in the matter of the Commissioner of Trade and Taxes vs. Corsan Corviam Construction S.A. Sadbhav Engineering Ltd.[2023 (4) TMI 4 - DELHI HIGH COURT] and also in the matter of Sandvik Asia Ltd. vs. Commissioner of Income-tax, Pune [2006 (1) TMI 55 - SUPREME COURT]. In our opinion, the issue is covered by the law interpreted and led down by the respective Courts in both these judgments. Since it is not in dispute that, the petitioner in view of the statutory mandate under Section 38(3)(a)(ii) of DVAT Act, 2004 is entitled for refund post 60 days from the date of submission of the return, and since in the present case the return was filed on 26th April 2009, it is held that the petitioner shall be entitled for the interest pursuant to the statutory mandate under the aforesaid provision as well as under Section 42 of the DVAT Act, 2004 with effect from 25th June 2009 at the rate of 6% per annum. We direct the respondent to calculate the interest on the Value Added Tax which was refunded to the petitioner i.e. an amount of ₹2,87,538/- at the rate of 6% per annum. The petitions are allowed in above terms. Issues: (i) Whether the petitioner is entitled to interest on the refund of VAT of Rs.2,87,538/- for the quarter ending 31.03.2009 under Section 38(3)(a)(ii) read with Section 42 of the DVAT Act, 2004, and if so, from which date and at what rate.Analysis: The statutory framework under Section 38(3)(a)(ii) prescribes refund timelines for quarterly filers and Section 42 provides for entitlement to interest on refunds at the rate prescribed by notification, to be computed daily. Rule 34 prescribes the procedural steps for sanctioning refunds and recording calculations. The assessment order dated 01.09.2011 rejecting the refund was not shown to have been served or uploaded on the portal; the appellate authority remanded the matter for fresh adjudication and the assessing authority subsequently allowed the refund, which was credited on 15.01.2025. The petitioner filed the return on 26.04.2009, making 25.06.2009 the date when the refund became due after the statutory 60-day period. The factual record does not establish that delay in processing the refund was attributable to the petitioner, and prior orders preserved the question of limitation and service/upload for adjudication by the appellate authority. Precedent on entitlement to interest for delayed refunds supports the claim.Conclusion: The petitioner is entitled to simple interest on the refunded amount of Rs.2,87,538/- at the rate of 6% per annum from 25.06.2009 until the date the refund was credited (15.01.2025); the respondent is directed to calculate and pay the accrued interest within 12 weeks.
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