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2022 (4) TMI 1250 - HC - VAT and Sales TaxRejection of application for refund of mandatory statutory obligation pre-deposit with interest - Excess amount then as accepted in the Resolution plant during CIRP proceedings under IBC - Section 82 (3) of the Rajasthan Value Added Tax Act, 2003 - HELD THAT:- Section 82(3) of the Act of 2003 imposes a mandatory statutory obligation of making a pre-deposit for entertaining an appeal. In appeals against ex parte assessment orders, the mandatory statutory pre-deposit would be 5% of the Value Added Tax and 10% of the Value Added Tax amount in other cases. As per Section 53 (4) of the Act of 2003, where refund of any amount becomes due to a dealer, he shall be entitled to receive simple interest at such rate as may be notified by the State Government - The Act of 2003 has further been supplemented by the Rajasthan Value Added Tax Rules, 2006 (the Rules of 2006). Rule 27 of the Rules of 2006 also deals with refund of excess tax/penalty/interest/other sum due, as a result of an assessment made or in pursuance of an order passed by any competent officer, authority or court. Once the tax liability raised by the Department had been fixed by effect of acceptance of Resolution Plan, manifestly, the Department could not hold on to any payment made by the assessee in excess of what has been approved under the Resolution Plan, i.e. ₹ 61.05 crores. The reasoning given by the Tax Board in the impugned orders that the amount deposited by the assessee by way of statutory pre-deposit was not a part of the Resolution Plan is absolutely without foundation for the simple reason that this amount was a proportion of the tax liability fixed on the assessee and once the total tax liability has been quantified by the NCLAT, any amount paid by the assessee over and above such amount would have to be reimbursed as per Section 53 (3) (3A) of the Act of 2003 read with Rule 27 of the Rules of 2006. In the case of STATE OF GUJARAT VERSUS ESSAR STEEL LTD [2016 (5) TMI 221 - GUJARAT HIGH COURT], Hon’ble Gujarat High Court directed refund of pre-deposit on acceptance of the appeals and decided the issue in favour of the assessee. In the present case, though the appeals have not been accepted, but an analogous situation has been created with acceptance of the Resolution Plan and extinguishment of all debts/liabilities of the sick unit towards the statutory creditor, i.e. the State Government/Commercial Taxes Department. The consolidated impugned order dated 28.12.2020 passed by the Rajasthan Tax Board, Ajmer in the appeals filed by the petitioner is set aside to the extent the applications filed by the petitioner for refund of pre-deposit amounts with interest were rejected - revision allowed.
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