TaxTMI 
TaxTMI 
2010 (6) TMI 725
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....appearing on behalf of the petitioner, at the outset, stated that in this writ petition he would be limiting his submissions to prayer (i) above and that he seeks liberty to raise the issues concerning prayers (ii) and (iii) by way of a separate proceeding. We grant him that liberty. 2. The petitioner is engaged in the business of trading in mobile phones and is registered with the Trade and Taxes Department since 2000. As per the provisions of the Delhi Value Added Tax Act, 2004 (hereinafter referred to as, "the said Act"), the petitioner has been paying taxes in terms of the said Act. The tax paid by making local purchases is the input tax which is either to be adjusted against the tax liability or allowed to be claimed as a refund if the output tax liability is less than the input tax so paid. In view of the aforesaid nature of transactions, the petitioner, for the year 2008-09 was entitled to refunds in terms of the quarterly returns filed by it under the self-assessment procedure. The entitlement of refunds, as per the petitioner in respect of the three quarters, which are the subject-matter of this writ petition, are as under: Period Amount of refund 1.7.2008 to 3....
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....tion 26 and section 27, shall be excluded. (8) Notwithstanding anything contained in this section, where,- (a) a registered dealer has sold goods to an unregistered person; and (b) the price charged for the goods includes an amount of tax payable under this Act; (c) the dealer is seeking the refund of this amount or to apply this amount under clause (b) of sub-section (3) of this section; no amount shall be refunded to the dealer or may be applied by the dealer under clause (b) of sub-section (3) of this section unless the Commissioner is satisfied that the dealer has refunded the amount to the purchaser. (9) Where,- (a) a registered dealer has sold goods to another registered dealer; and (b) The price charged for the goods expressly includes an amount of tax payable under this Act, the amount may be refunded to the seller or may be applied by the seller under clause (b) of sub-section (3) of this section and the Commissioner may reassess the buyer to deny the amount of the corresponding tax credit claimed by such buyer, whether or not the seller refunds the amount to the buyer. (10) Where a registered....
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.... the payment cannot be made. Mr. Taneja also submitted generally in respect of all the three claims that the period of two months specified in section 38(3) and the period of fifteen days mentioned in section 38(5) of the said Act were merely directory and not mandatory. Mr. Taneja also referred to a decision of this court in the case of Commissioner of Sales Tax v. Behl Construction [2009] 21 VST 261; [2009] 162 ECR 110 in support of his submission. 5. A plain reading of section 38, which deals with refunds, makes it clear that by virtue of sub-section (3) thereof, in the case where a person is assessed quarterly, the refund is to be made to the dealer within two months after the date on which the return is furnished or the claim for the refund is made. Of course, it is the dealer's option to elect as to whether the refund is to be made in cash or the said amount is to be carried forward to the next tax period as a tax credit in that period. In the present case, the petitioner has elected for the grant of refunds in cash and has not elected for carrying forward the refund amount to the next tax period. The provisions of section 38(3) uses the expression "shall" and, therefo....
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....onths for the proper preparation of its position, in which case the period of the adjournment shall not be counted towards the period by which the Commissioner shall reach his decision." 7. One of the arguments raised in Behl Construction [2009] 21 VST 261 (Delhi); [2009] 162 ECR 110 (Delhi) was that the provisions of section 74(7) of the said Act were directory and not mandatory. This court agreed with that submission on a consideration of the provisions of section 74(7) in conjunction with the provisions of sub-sections (8) and (9) of section 74 which read as under: "(8) Where the Commissioner has not notified the person of his decision within the time specified under sub-section (7) of this section, the person may serve a written notice requiring him to make a decision within fifteen days. (9) If the decision has not been made by the end of the period of fifteen days after being given the notice referred to in sub-section (8) of this section, then, at the end of that period, the Commissioner shall be deemed to have allowed the objection." 8. While construing the said provisions, in order to decide the issue as to whether the provisions of section 74(7) we....
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....of the statute and no hard and fast rule can be laid down for such a determination. Consequently, the fact that the word "shall" as appearing in section 74(7) was taken to be directory and not mandatory in Behl Construction [2009] 21 VST 261 (Delhi); [2009] 162 ECR 110 (Delhi), does not ipso facto mean that the word "shall" as appearing in section 38(1) and 38(3), also ought to be construed as being merely directory. The provisions of section 74 and those of section 38 operate in entirely different fields and deal with different situations. The legislative intent that is discernible in respect of section 74(7), in the context of its related provisions, does not necessarily mean that the same legislative intent ought to be applied to the provisions of section 38. In Behl Construction [2009] 21 VST 261; [2009] 162 ECR 110, this court had observed that (at para 10 of VST): "8. In sub-sections (8) and (9) of section 74, the Legislature has provided for the situation where the Commissioner does not dispose of the objections during the applicable period. This, in itself, is indicative of the fact that the Legislature was mindful of such a situation and that the mere passage of t....
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....ty under sub-section (5) to the satisfaction of the Commissioner or to furnish the additional i nformation sought under section 59 or to furnish returns under sections 26 and 27, "shall be excluded". This provision as to exclusion of time taken in doing the aforesaid acts, is in itself an indication that the Legislature was dead serious about the stipulation as to time for making refunds under section 38(3) of the said Act. For, if the legislative intent were not so, what was the need or necessity for providing for exclusion of time? Thus, not only do the provisions of section 38 employ the word "shall", which is usual in mandatory provisions, the legislative intendment discernible from the said provisions also points towards the mandatory nature of the said provisions. Clearly, subject to the exclusion of time provided under subsection (7) of section 38, in a case falling under section 38(3)(a)(ii), the refund has to be made within two months from the date of the return. 11. In the present case, as would be apparent from the tables given above, the first refund was in respect of the return filed on November 3, 2008 and, therefore, in view of section 38(3), the refund ought to h....
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....12,99,718 forthwith along with interest thereon to be calculated in terms of section 42 of the said Act. 12. We now come to the second claim of refund of Rs. 15,54,232. We find that Mr. Taneja has taken the plea that a notice under section 59 had been issued to the petitioner on June 9, 2009 which has gone unanswered and it is because of this that the refund payment has not been made. First of all, we may point out that the learned counsel for the petitioner stated that the purported notice dated June 9, 2009 issued under section 59 for production of documents has not been received by the petitioner. Furthermore, the address given in the notice, a copy of which was shown to the petitioner in court today, is different from the address of the petitioner as given in the petition. The address given in the petition is F-137, Rajouri Garden, New Delhi. The learned counsel also pointed out that all the communications addressed to the respondents are under a letterhead of the petitioner which bears an address which is the same as that given in the petition. However, the address given in the purported notice dated June 9, 2009 is 201, F-8A, Vijay Block, Laxmi Nagar, Delhi. In fact, even ....