TMI Blog2023 (5) TMI 235X X X X Extracts X X X X X X X X Extracts X X X X ..... ct of the request made by the Petitioner to keep the refund on hold was communicated to the Petitioner by the Respondent Authorities. The Defect Notice and the Refund Adjustment Order are apart only by a day and this could not have provided sufficient opportunity to the Petitioner even to seek redressal of his grievance from the Authorities. Even while the Authorities had not responded to the communication dated 12 April 2019 of the Petitioner, whereby the Petitioner had requested the Authorities to keep the refund amount on hold as they were in the process of filing an application under the Amnesty Scheme, the Respondent Authorities, in our view, could not have, while the application for the Amnesty Scheme was under consideration in the absence of any response to the erstwhile Petitioner's communication dated 12 April 2019 gone ahead without any notice to the Petitioner and adjusted the refund amount for the year 2011-2012 against the dues for the year 2010-2011 and that too when the Petitioner had already filed the application under the Amnesty Scheme which was accepted by the Respondent Authorities alongwith the payment of Rs. 8,46,84,821/-under the said scheme. Non co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ged in procuring vehicles from Tata Motors Limited ( TML ) and selling them to dealers within and outside the State of Maharashtra. The Petitioner was formerly known as the TML Distribution Limited . Pursuant to order dated 11 March 2022 passed by NCLT, Mumbai Bench V in CA (CAA/255/MB-V/2021) all assets and liabilities of TML Distribution Company Limited have been transferred from transferor company (TML Distribution Company Limited) to the transferee company (TML Business Services Limited). Petitioner is registered under the Maharashtra Value Added Tax Act, 2002 ( MVAT Act ) and Central Sales Tax Act, 1956 ( CST Act ). 3. Pursuant to an assessment under Section 23 of the MVAT Act for the financial year 2010-2011, the Assessing Officer passed an Assessment Order dated 30 March 2015, raising a demand of Rs. 17,76,93,422/- including tax and interest. Aggrieved by the same, the Petitioner filed an appeal which resulted in a reduced demand of Rs. 14,00,74,890/-. 4. For the financial year 2011-2012 an assessment order dated 21 August 2017 was passed raising a demand of Rs. 9,67,02,366/- including tax and interest. A first appeal was filed by the Petitioner against this order w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 16 and fee except when the fee is paid by way of court fee stamp, if any, paid by such person in excess of the amount due from him. The refund may be either by deduction of such excess from the amount of tax, penalty, amount forfeited and interest due, if any, in respect of any other period or in any other case, by cash payment: Provided that, the Commissioner shall first apply such excess towards the recovery of any amount due in respect of which a notice under sub-section (4) of section 32 has been issued, or, as the case may be, any amount which is due as per any return or revised return but not paid and shall then refund the balance, if any. (2) If a registered dealer has filed any returns, fresh returns or revised returns in respect of any period contained in any year and any amount is refundable to the said dealer according to the return, fresh return or revised return then subject to rules, the dealer may adjust such refund against the amount due as per any return, fresh return or revised return for any period contained in the said year, filed under this Act or the Central Sales Tax Act, 1956 (74 of 1956) or the Maharashtra Tax on the Entry of Goods i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mount paid by the Applicant was Rs. 8,46,84,821/-. The notice also records that the amount outstanding as per the Respondent's office record is Rs. 3,30,85,284/- and the requisite amount payable for settlement of dues would be Rs. 66,17,057/-. The Defect Notice, shows a zero amount in the short paid column, thereby indicating no amount is payable by the Petitioner but also no amount is refundable to the Petitioner even though as noted above, only Rs. 66,17,057/was payable whereas Petitioner has paid a larger sum of Rs. 8,46,84,821/- towards the settlement under the Amnesty Scheme against the dues of Rs. 14,00,74,890/- for the year 2010-2011. It is Petitioner's case that the said email did not mention anything about the amount paid by the erstwhile Petitioner in full settlement of the debt for the year 2010-2011. 13. A Refund Adjustment Order dated 23 May 2019 was received by the erstwhile Petitioner informing that the refund of Rs. 10,69,89,606/- which was due to them would be adjusted towards the amount of tax due for the year 2010-2011. The Defect Notice and the Refund Adjustment Order appear to have been issued by the same officer, viz. Deputy Commissioner of State Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fund Adjustment Order dated 23 May 2019 as also the action in not allowing the settlement of the total dues for the year 2010-2011 is illegal, unconstitutional and liable to be set aside by this Court. 21. On the other hand, Ms. Shruti Vyas, learned AGP relies upon the affidavit in reply dated 19 September 2019 filed on behalf of the Respondent Authorities. At the outset, learned AGP submits that the writ is not maintainable as a remedy of statutory appeal is available and that Petitioner should have filed an appeal. She would further submit that as per proviso to Section 50 (1), the Commissioner has to first apply any excess towards the recovery of any amount due and after that refund the balance, if any. She submits that accordingly the dues of Rs. 14,00,74,890/-, which were available for recovery since 12 April 2019 were first adjusted to the refund that became available on 10 May 2019 for adjustment and the balance, if any, was to be refunded. Learned Counsel also relies upon the Trade Circular dated 15 May 2019 annexed to the reply, which has been issued as a clarification to the Amnesty Scheme/ Ordinance. Learned AGP refers to question no. 23 of the said clarification in s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rstwhile Petitioner under the scheme and the requisite amount that was payable was only Rs. 66,17,057/-, in view of the above Section 18, the balance amount cannot be refunded to the Petitioner. Learned AGP would submit that it is the Petitioner, who should have planned its affairs accordingly and is solely responsible for the situation and now cannot seek the refund of the amount as the same is not permissible under the provisions of the scheme. She would submit that therefore, the Petition deserves to be dismissed. 24. Mr. Dada, learned Senior Counsel in rejoinder, drew the attention of this Court to Rule 60 of the MVAT Rules, 2005 with effect from 1 April 2005 to submit that in the matter of grant of refund, any adjustment is to be at the desire of the dealer to adjust the refund and that too against tax payable in respect of any subsequent period and not for any previous period as is sought to be done in the present case. Rule 60 of the MVAT Rules, 2005 is quoted as under:- 60. Grant of Refund (1) Application for refund under section 51 shall be made in Form 501. (2) When the Commissioner is satisfied that a refund is due, he shall pass an order in Form 502, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the manner herein provided, and at such intervals as may be prescribed. (2) A registered dealer furnishing returns as required by section 20 shall pay into the Government treasury, in such manner and at such intervals as may be prescribed, the amount of tax due from him for the period covered by a return which he is required to file along with the amount of interest and any other sum payable by him. (3) A registered dealer furnishing a revised return in accordance with sub-section (4) of section 20, when the revised return shows that a larger amount of tax than, the tax already paid, is payable, shall first pay into the Government treasury the extra amount of tax. (4) (a) (i) The amount of tax due where the return or revised return has been furnished without full payment thereof shall be paid forthwith. (ii) the amount of tax which it becomes necessary to pay on account of the reduction in set-off because of any contingency specified in the rules, shall be paid at the time prescribed for making payment of tax for the period in which such contingency occurs. (b) (i) The amount of tax due as per any order passed under any provision of this Act, for any per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... applicant proves to the satisfaction of the Commissioner that the goods are not resold by him as aforesaid and if the Commissioner is satisfied that the claim is valid and admissible and that the amount so claimed as refund was actually paid in Government treasury or recovered and no set-off or refund in respect of that amount was granted, he shall refund the sum or any part thereof, which is found due to the person concerned. (7) (i) There shall be established a Fund to be called the Maharashtra Consumer Protection and Guidance Fund (hereinafter, in this section, referred to as the Fund ). From the amounts forfeited and recovered except for the amounts refunded as aforesaid to the purchasers and except for the amounts in respect of which a set-off or refund is granted, the remaining amount shall, after deducting the expenses of collection and recovery as determined by the State Government, under appropriation duly made by law in this behalf, be entered into, and transferred to, that Fund. (ii) No sum from the Fund shall be paid or applied for any purpose other than the one specified in clause (iii). (iii) The Fund shall be administered in the prescribed manner; a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its intention to file an appeal against the order for the year 2010-2011 and had also requested that refund of Rs. 10,69,89,606/- for the year 2011-2012 be kept on hold till filing of its application under the Amnesty Scheme. It is not in dispute that against the said communication there was no response from the Respondent Authorities. The Petitioner filed an application under the Amnesty Scheme on 13 May 2019 by making a payment of Rs. 8,46,84,821/-. No objection to the communication dated 12 April 2019 or any response to the fact of the request made by the Petitioner to keep the refund on hold was communicated to the Petitioner by the Respondent Authorities. It is only pursuant to the Defect Notice, Petitioner figured out that the excess amount would not be refunded to the Petitioner and it is only on 23 May 2019 pursuant to the Refund Adjustment Order that the Petitioner came to know that the refund of Rs. 10,69,89,606/- granted for the year 2011-2012 would be adjusted towards the amount of tax due for the period 2010-2011. There was no notice whatsoever of this adjustment to the erstwhile Petitioner. 31. These actions of the Respondent Authorities in our view cannot be coun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d of the Respondent-Authority will have to be interpreted as a necessity in the light of our observations, which in our view, has resulted in grave prejudice to the Petitioner. 33. Further, in our view, serious prejudice has also been caused to the Petitioner by the Respondent Authorities in not putting the Petitioner to notice of the adjustment that was effected pursuant to the Refund Adjustment Order. 34. The Statement of Objects and Reasons for introducing the Amnesty Scheme clearly record that as large number of cases and litigation are pending in respect of the repealed laws pursuant to the introduction of the GST Act locking substantial amount of tax, therefore, the Government considered it expedient to provide a scheme for settlement of arrears of tax, interest, penalty or late fee under those Acts for the period ending on or before 30 June 2017, so that the settlement of such disputes would safeguard the revenue and also settle the arrears of tax. 35. In the face of such objectives of the Amnesty Scheme, the State cannot submit in its affidavit or the AGP cannot be heard to be arguing that just because of the communication dated 12 April 2019 pursuant to which the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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