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2016 (11) TMI 215 - HC - VAT and Sales TaxInterest on refund - Article 14 of the Constitution of India - Writ of mandamus - Period of limitation - Held that: - Clause (aa) to sub section (1) of Section 54 of the GST Act was inserted by the Gujarat Act 11 of 1993 - under the said provision a dealer entitled to refund by virtue of an order of assessment would receive in addition to such amount, simple interest at the specified rate to be calculated from the date immediately following the date of closure of the accounting year to which such amount relates till the date of order of the assessment - Combined reading of this explanation would show that the interest in terms of Section 54(1)(aa) would be available wherever the refund arises out of an assessment for the financial year commencing from 01.04.1993 or onwards - For classification, however, to be reasonable and to pass the test of Article 14, twin conditions must be satisfied viz. that the same distinguishes persons or things from those which are left out of such class and that the same is based on rational relation to the object sought to be achieved by the law - When the legislature frames a new provision which either creates or extinguishes existing rights, there is invariable requirement of making such a provision applicable from a certain date. Regarding Interest - When the Assessing Officer wanted to tax the petitioner by denying the set off on tax paid on purchase of raw materials for manufacture of goods which are sold outside the State, the petitioner relied on the decision of the Tribunal in case of Wood Polymers Ltd [1982 (3) TMI 231 - GUJARAT HIGH COURT] - Held that: - Till such appeal is decided, the Revenue would have to keep such an issue alive whenever it arises in case of other assesses - The fact, that the Revenue had carried the judgement of the Tribunal in appeal before the High Court and such appeal was pending, did not permit the Assessing Officer to ignore judgement of the Tribunal and compel the assessee to go in appeal. The Tribunal in view of the fact that the first appellate authority had proceeded ex parte merely remanded the proceedings before the first appellate authority for fresh consideration and disposal - Not on the ground that interest, as a matter of course, must be paid on the principal of compensatory basis, in the present case, we are inclined to grant such interest on the ground that the department had unauthorizedly and illegally for nearly three decades withheld the amount which legally belonged to the petitioner. we have noticed that the claim of interest can arise out of a statutory provision providing for such interest or contractual relations, nothing prevents a constitutional court from granting such interest in extraordinary circumstances where the money has been withheld by the State for a long period of time without any authority in law - Decided in favor of the petitioner.
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