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TMI Blog2019 (5) TMI 805X X X X Extracts X X X X X X X X Extracts X X X X ..... d under the DVAT Act. In accordance with the provisions of the statute, the petitioner pays tax on purchases made within the state ('input tax') which is adjusted against the tax payable on sales ('output tax'). The petitioner claims refunds on account of the fact that its output tax liability is less than the input tax paid. To the extent that the petitioner's sales are inter-state sales, it is entitled to a concessional rate of tax of 2% against C forms. 3. For the quarter 01.01.2014 to 31.03.2014, the petitioner filed a return claiming a refund of Rs.17,59,874/-. The failure of the respondents to issue the refund led to the filing of W.P(C) 8762/2018 before this Court. However, after notice was issued in that petition on 21.08.2018, def ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... him. (2) Before making any refund, the Commissioner shall first apply such excess towards the recovery of any other amount due under this Act, or under the CST Act, 1956 (74 of 1956). (3) Subject to 1 [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 claimin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es an amount of tax payable under this Act; (c) the dealer is seeking the refund of this amount or to apply this amount under clause (b) of sub-section (3) of this section; no amount shall be refunded to the dealer or may be applied by the dealer under clause (b) of sub-section (3) of this section unless the Commissioner is satisfied that the dealer has refunded the amount to the purchaser. [(9)] Where - (a) a registered dealer has sold goods to another registered dealer; and (b) the price charged for the goods expressly includes an amount of tax payable under this Act, the amount may be refunded to the seller or may be applied by the seller under clause (b) of sub-section (3) of this section and the Commissioner may reassess the bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was put up to the concerned Special Commissioner. It appears that, pursuant to a discussion at the instance of the Special Commissioner, a further note was prepared on 12.11.2018 disclosing the "mismatch at first and second level" and seeking approval for raising a demand of the amounts mentioned. The approval having been granted by the Commissioner on the same date, the impugned default assessment was made and the refund adjustment order was issued. 9. On similar facts, this Court in (M/s. S.K. Engg. Works vs. Commissioner of Delhi Value Added Tax & Anr.) [W.P.(C) 2124/2017, decided on 02.05.2017] held as follows:- "1. The Petitioner's refund application for the 4th quarter of 2013-14 has been pending with the Respondent DVAT Department ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Value Added Tax (2010) 31 VST 475 (Del) and Prime Papers and Packers v. Commissioner VAT (2016 )94 VST 347 (Del) emphasized that the pendency of a refund application should not be viewed by the Department as an opportunity to create a fresh demand particularly if the time limits not only for making the refund but even for re-opening the assessments of previous years has long been crossed. 4. Yet, that is precisely what the Department has done here. The entire exercise indulged in by the VATO as above at the stage of refund is wholly without the authority of law. The re-opening of the assessments of earlier periods is time-barred and not in accordance with the procedure set out for that purpose under the DVAT Act. 5. The Court, therefor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate that there is no mismatch between the selling and purchasing dealers. Yet a demand is sought to be raised in respect of alleged mismatch. 12. Following the judgments of this Court, inter alia in M/s S.K. Engg. Works (supra) and Pradeep Enterprises (supra), we are of the view that the impugned default assessment orders dated 14.11.2018 and the refund adjustment order dated 15.11.2018 cannot be sustained, and the same are hereby set aside. Consequently, the petitioner is entitled to refund of the amount of Rs.17,59,874/- claimed by it. The said amount, along with interest payable under Section 42 of the DVAT Act, shall be disbursed by the DVAT authorities within four weeks from today. 13. The writ petition is allowed in the above terms. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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