Assessee entitled to Refund in absence of any Power with Revenue to forfeit Excess Tax: Gujarat High Court [Read Order]

The Gujarat High Court while directing the authority to refund said that the assessee entitled to refund in absence of any power with Revenue to forfeit excess tax.

The petitioner, Advanced Systek Pvt. Ltd. is a limited Company incorporated under the provisions of the Companies Act, 1956.

The petitioner paid tax at the rate of 10% or 12.5% instead of paying the same at the rate of 4% in absence of Form ‘C’ under the CST Act by making a reverse working in accordance with Section 8A of the CST Act.

The authorities from the Central Sales Tax Department were supposed to refund the said amount to the petitioner as the petitioner would be liable to pay only 4% tax and not 10 or 12.5% tax on the invoice price of the goods or machineries sold by it.

The petitioner has filed Special Civil Application through its director with a prayer for directing the respondents to comply with the order passed by the Gujarat Value Added Tax, Tribunal at Ahmedabad in Second Appeal as the respondents are not paying the refund of Rs.1,82,71,928 to the petitioner on the ground that the Tax Appeal arising out of the order passed by the Tribunal in Second Appeal.

The court took into consideration the judgment passed by the Apex Court in the case of Mafatlal Industries wherein it was held that in the absence of any power with the Revenue to forfeit such excess tax, the respondent-assessee is entitled to refund of the same. The division bench consisting of Justice J.B. Pardiwala and Justice Bhargav D. Karia while allowing the application filed by the assessee directed the respondent authority to issue refund order in favour of the assessee within three months from the date of receipt of the writ of this order together with simple interest at the rate of 6% per annum from the date of deposit till the date of realisation.