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2021 (12) TMI 356 - HC - VAT and Sales TaxEntitlement to Interest on delayed payment of refund - section 40(2) of the U.P. Value Added Tax Act, 2008 - U.P. Trade Tax Act, 1948 - HELD THAT:- Since, on the date of repeal, the earlier rebate notification dated 27.02.1998 stood withdrawn and only a challenge thereto was pending before this Court (under Article 226 of the Constitution of India), it may never be said that any right or privilege as to rebate had been acquired or had accrued in favour of the petitioner as may have been protected or saved under section 81(2)(b) of the VAT Act. By way of effect caused by the repeal of the Erstwhile Act and by virtue of section 6(e) of the UP General Clauses Act, 1904, any remedy or legal proceeding if it had been commenced before the repeal (with respect to any right, privilege etc.) would remain intact. However, the proceeding here being a constitutional remedy availed by the petitioner, the same may even otherwise have survived the repeal - the principle of unjust enrichment may have disentitled a refund claim irrespective of its absence - as a statutory principle incorporated in that enactment itself. It being a judicially evolved principle, unjust enrichment would find its applicability to all cases of indirect taxation - wherever an assessee/claimant was found to have passed on the disputed tax liability to another, while resisting its imposition qua the State. Present is not a case of amendment of section 29 of the Erstwhile Act but of repeal and replacement of the Erstwhile Act itself by a completely new enactment namely, VAT Act - Since section 40(1) of the VAT Act is found to be wholly inapplicable viz-a-viz the claim for refund of trade tax for the A.Ys. 2004-04 to 2007-08, the language of section 40(2) of the VAT Act is of no help to the petitioner. That provision of law providing for interest on delayed payment of refund would apply to only those cases that fall under the purview of section 40(1) of the VAT Act, and to no other. That is the plain effect of sub-section (2) of section 40 of the VAT Act. In the present case, the order of refund was passed on 29.6.2020 whereas the refund was adjusted against the demand of entry tax on 07.07.2020 i.e. within the statutory period of thirty (30) days - the petitioner is found not entitled to interest on the amount of refund of trade tax ₹ 17,90,61,418/-, up to the date 07.07.2020. Petition dismissed.
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