TaxTMI 
TaxTMI 
2026 (1) TMI 1340
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....d Tax Act, 2004 (hereinafter referred to as "DVAT Act, 2004") has approached this Court seeking interest on the amount refunded for the quarter ending on 31st March 2009. 5. The exact prayer of the petitioner reads thus: - "1. To grant interest along with compensation for delayed issue of refund as claimed in the DVAT return for the quarter ending on 31.03.2009 after a delay of more than 15 years and 6 months." 6. The facts which are necessary for deciding the present petition are as under: 7. The petitioner is registered with the respondent and has accordingly filed the return for the quarter ending on 31st March 2009, on 26th April 2009, in which the petitioner claimed that he is entitled for refund of an amount of Rs.2,87,538/-. 8. An ex-parte default assessment order came to be passed in view of statutory mandate provided under Section 32 of the DVAT Act, 2004, rejecting the claim for refund. 9. Questioning legality of the said order and also claiming that the said order was not served upon the petitioner, the petitioner approached this Court through a writ petition bearing W.P.(C) 8045/2017, wherein this Court passed an order on 11th April 2018 permitti....
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....f DVAT Act, 2004 are attracted and petitioner is entitled for simple interest at the rate of 6% per annum from the date the refund was due and receivable after the expiry of the period of 60 days provided under Section 38(3)(a)(ii) of the DVAT Act, 2004. 15. For ready reference, Section 38(3)(a)(ii) of the DVAT Act, 2004 is reproduced herein below: - "(3) Subject to [sub-section (4) and sub-section (5)] of this section, any amount remaining after the application referred to in sub-section (2) of this section shall be at the election of the dealer, either - [(a) refunded to the person, - (i) within one month after the date on which the return was furnished or claim for the refund was made, if the tax period for the person claiming refund is one month; (ii) within two months after the date on which the return was furnished or claim for the refund was made, if the tax period for the person claiming refund is a quarter; or]" 16. According to learned counsel for the petitioner, the respondents are accordingly duty bound under the aforesaid statutory mandate to provide for the interest. 17. So as to substantiate his contention, he has drawn su....
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....the case on the basis of documents submitted by the Petitioner strictly in terms of the provisions under DVAT Act, 2004. (vii) On 07.05.2024, the Petitioner also filed Form DVAT-21 in terms of Rule 34 of the DVAT Rules, 2005 inter alia seeking refund of the amount of Rs. 2,87,538/- (viii) On 14.08.2024, the Respondent No. 1 after re-examination of the case and the records produced by the Petitioner, passed an order for refund in Form DVAT-22 on 14.08.2024 resulting into refund of Rs. 2,87,538/- in favour of the Petitioner. (ix) The refund amount of Rs. 2,87,538/- was credited to the bank account of the Petitioner on 15.01.2025." 20. According to the learned counsel, if the aforesaid events are critically appreciated in backdrop of the very conduct of the petitioner, the respondent cannot be blamed for delay in processing the request for refund of the tax as the petitioner was also not diligent in timely prosecuting his statutory remedy. 21. In addition to the above, it is his contention that the appellate authority, while remanding the matter, made the following observations: - "5. After having carefully perused the aforesaid impugned order....
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....r, particularly when the respondent has not taken recourse to the procedure established by law, as referred above. 26. We have appreciated the aforesaid submissions. 27. If we consider the scheme of Section 38 of DVAT Act, 2004 which provides for refund, the Commissioner is empowered to refund to a person amount of tax, penalty and interest, if any, paid by such person in excess of amount due from him. Such proceedings by the Commissioner are subject to provisions of the rules framed under the DVAT Act, 2004. 28. Further, if we peruse Section 42 of the DVAT Act, 2004, it is a code in itself. The said Section provides for entitlement of a person for interest on refund at the rate of interest to be prescribed by the Government through notification. The interest is to be computed on daily basis. 29. Rule 34 of DVAT Rules, 2005 prescribes the procedure to be adopted in the matter of refund of excess payment. Under Sub-rule 5 of Rule 34, in case, if the Commissioner is satisfied that a refund is admissible, the Commissioner is empowered to determine the amount of refund due and record an order in form DVAT 22 sanctioning the refund and recording the calculations used in the ....
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....er the order was uploaded on the portal immediately upon being passed, so as to infer that the petitioner has sufficient notice of the order refusing the refund of claim/tax. 39. The appellate authority rather was of the conscious view that such fact was not established by the respondent and as such decided to direct the assessing authority to grant a fresh opportunity of hearing by remanding the matter back. 40. In the wake of aforesaid, it cannot be inferred that there was any attempt on the part of the petitioner to approach at delayed stage either before this Court in writ petition in the earlier round of litigation, or before the Commissioner pursuant to the order passed by this Court on 11th April 2018 in W.P.(C) 8044/2017 with connected matter. 41. The interest shall be calculated till the tax was refunded to the petitioner which in this case is 15th January 2025. 42. 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 Engine....