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2016 (3) TMI 1074 - HC - VAT and Sales TaxSeeking direction to disburse the refund along with the interest forthwith in terms of the provisional refund orders - Petitioner purchased cigarettes of various brands from the State of Gujarat and availed input tax credit in terms of section 11(3) of the GVAT Act as the same were purchased for the purpose of re-sale in the State of Gujarat and in the course of inter-state trade and commerce. Held that:- for the purpose of invoking section 39 of the Act, the condition precedents that are required to be satisfied are: firstly that there should be an order which gives rise to a refund; and secondly, that such order should be subject matter of (i) appeal, or (ii) further proceeding, or (iii) any other proceeding under the Act should be pending. It is only if both these conditions precedent are satisfied then resort can be made to the provisions of Section 39 of the GVAT Act. In the present case, the first condition precedent, viz., an order giving rise to a refund is satisfied, inasmuch as, the order of provisional refund does give rise to a refund. Insofar as the second condition precedent is concerned, the respondent was not in a position to point out that any of the three eventualities specified in the section are satisfied. Thus, it is an admitted position that the order of provisional refund is not subject matter of appeal, nor is there any further proceeding in connection therewith, nor is any other proceeding under the Act pending. Therefore, none of the three contingencies constituting the second condition precedent for invoking Section 39 of the GVAT Act is satisfied. Therefore, clearly, the impugned order has been passed without the conditions precedent for exercise of such power being satisfied and therefore, lacks jurisdiction. Under the circumstances, the contention that the petitioner should be relegated to avail of the remedy of appeal under Section 73 of the GVAT Act does not merit acceptance, inasmuch as, it is by now well settled that when an order is without jurisdiction, it is permissible for the aggrieved party to invoke the extraordinary jurisdiction of this court under Article 226 of the Constitution of India. The provisions of section 39 of the GVAT can be invoked provided the circumstances referred to hereinabove exist. If such circumstances exist, the Commissioner is empowered to withhold the refund provided he is of the opinion that such refund is likely to adversely affect the revenue. Thus, before withholding the refund, the Commissioner is required to form an opinion that the grant of refund is likely to adversely affect the revenue. The fact regarding formation of such opinion, therefore, should be reflected in the order passed under section 39 of the GVAT Act withholding the refund. in the absence of formation of any opinion that the refund is likely to adversely affect the revenue, the question of withholding the refund would not arise. Thus, none of the requirements for resorting to the power conferred by section 39 of the GVAT Act are satisfied in the present case. The impugned order, therefore, suffers from lack of jurisdiction and hence, cannot be sustained. Therefore, in the absence of formation of any opinion that the refund is likely to adversely affect the revenue, the question of withholding the refund would not arise. Thus, as none of the requirements for resorting to the power conferred by section 39 of the GVAT Act are satisfied, the impugned order cannot be sustained suffers from lack of jurisdiction. The respondents are directed to forthwith disburse the refund along with interest to the petitioner in terms of the provisional refund orders. - Decided in favour of petitioner
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