TMI Blog2016 (7) TMI 858X X X X Extracts X X X X X X X X Extracts X X X X ..... 2016. If there is any failure by the Respondent to comply with the directions, the Petitioners shall seek appropriate relief in accordance with law. - Decided against the revenue. - W. P. (C) 7511/2015, W.P.(C) 8104/2015, W.P.(C) 8393/2015 - - - Dated:- 12-7-2016 - S. Muralidhar And Najmi Waziri, JJ. For the Petitioner : Mr. A.K. Babbar with Mr. Surinder Kumar, Mr. Bhagat Tripathi, Ms. Amita Babbar, Advocates For the Respondent : Mr. Naushad Ahmed Khan, ASC (Civil) with Ms. Astha Nigam, Advocate ORDER Dr. S. Muralidhar, J. 1. Nucleus Impex Pvt. Ltd ( NIPL ) is the Petitioner in W.P.(C) Nos. 8104 8393/2015 and Nucleus Marketing Communication ( NMC ) in W.P.(C) 7511/2015. They are dealers duly registered under the Delhi Value Added Tax Act, 2004 ( DVAT Act ) and Central Sales Tax Act, 1956 ( CST ). 2. The essential grievance of the Petitioners is against the failure by the Respondent, Commissioner, Delhi Value Added Tax ( DVAT ) to grant refund together with interest due to the Petitioners in accordance with Section 38 of the DVAT Act. In the case of NMC the refund together with interest was due for the months of November 2012 for the year 2012-13 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d v. Government of NCT of Delhi (2016) 92 VST 83 (Del). 7. Pursuant to the notices issued in these petitions, counter-affidavits have been filed in W.P.(C) Nos. 8104 and 8393/2015 by the Respondent. In the first place, it is urged that an alternative remedy is available to the Petitioners under the DVAT Act since any return filed by the dealer is deemed to be a notice of assessment under Section 31 (1) (b) of the DVAT Act and if the Commissioner had failed to issue any assessment or order to that effect then the person aggrieved by such failure can file an objection before the Objection Hearing Authority ( OHA ) under Section 74 (2) of the DVAT Act. If the dealer is still aggrieved by the decision of the OHA, an appeal can be preferred before the Appellate Tribunal (AT) under Section 76 (1) of the DVAT Act. 8. As regards the preliminary objection raised by the Respondent, the Court finds that the matter pertains to the delay in processing and issuing the refund due to the Petitioners. For the reasons discussed hereinafter it would be seen that even in the matter of processing of the refund claim, the Respondent has not adhered to the time limits set out in Section 38 of the D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment orders dated 31st March 2015 being issued by the AVATO for the 3rd quarter of 2014-15 under Sections 32 and 33 of the DVAT Act to which the objections were filed before the OHA. The OHA has referred to the fact that the survey team had in the course of the survey collected two cheques of ₹ 13,30,790 from the Petitioner towards tax and ₹ 2,66,158 towards penalty without framing any assessment under the DVAT Act. The OHA has in respect of the above actions concluded as under: As such, there appears to be tax collection prior to the framing of assessment in the orders. There is documentary evidence on record that proves collection of advance tax and penalty is unlawful, and same was paid in protest under coercion and duress. The facts of the case clearly indicate that no assessment was framed prior to the collection/deposit of tax and penalty sums above mentioned, hence not within the framework of law. Objector is eligible to seek refund of above stated advance tax and penalty paid as per the established provisions of law after satisfying the Ward Officer showing proof of payment of the same. 13. It is surprising that the Respondent has, while filing the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mount due under this Act, Or under the Central Sales Act, 1956 (74 of 1956). (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 (b) carried forward to the next tax period as a tax credit in that period. (4) Where the Commissioner has issued a notice to the person under Section 58 of this Act advising him that an audit, investigation or inquiry into his business affairs will be undertaken or sought additional information under Section 59 of this Act, the amount shall be carried forward to the next period as a tax credit in that period. (5) The Commissioner may, as a condition of the payment of a refund, demand security from the person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 38 (7) of the DVAT Act. For taking any action under Section 38 (8) or 38 (9) or 38 (11) the dealer would have a notice in the first place by the Commissioner. Such notice would have to be only issued in such a manner that the time limit prescribed under Section 38 (3) of the DVAT is not exceeded. Where notice is already issued under Section 58, or additional information sought under Section 59 of the Act, it is only in the circumstances under Section 38 (4) of the DVAT Act, the refund amount sought shall be carried forward to the next tax period as a tax credit in that period. In other words there are several options available to the Commissioner, VAT or his delegates in response to the application for refund. All these options have to be exercised in such a manner that the time limit under Section 38 (3) is adhered to. Obviously, the proceeding under Section 38 cannot result in reopening of concluded assessment. The statutory rejection for that course of action is entirely different. In other words, having missed the bus on the question of the reopening of a concluded assessment for whatever reason, the Commissioner cannot indirectly at the time of processing the applicatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ub-section (3) thereof. This intention is further fortified by a look at the provisions of sub-section (7) of Section 38 which stipulates that for calculating the period prescribed in clause (a) of sub-section (3), the time taken to furnish the security under sub-section (5) to the satisfaction of the Commissioner or to furnish the additional information sought under Section 59 or to furnish returns under Sections 26 and 27, shall be excluded . This provision as to exclusion of time taken in doing the aforesaid acts, is in itself an indication that the legislature was dead serious about the stipulation as to time for making refunds under Section 38 (3) of the said Act. For, if the legislative intent were not so, what was the need or necessity for providing for exclusion of time? Thus, not only do the provisions of Section 38 employ the word shall , which is usual in mandatory provisions, the legislative intendment discernible from the said provisions also points towards the mandatory nature of the said provisions. Clearly, subject to the exclusion of time provided under sub-section (7) or Section 3 8, in a case falling under Section 38(3)(a)(ii), the refund has to be made within ..... X X X X Extracts X X X X X X X X Extracts X X X X
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