In a recent judicial decree, the Supreme Court has wielded its authority, affirming the imperative of adhering to prescribed time limits for processing and disbursing refunds under Section 38 of the Delhi Value Added Tax Act of 2004.
With eloquent precision, the bench comprising Justices PS Narasimha and PB Varale emphasized the mandatory nature of Section 38(3), underscoring its pivotal role in ensuring the expeditious processing and issuance of refunds. The Court’s stance fortifies the legislative intent behind the provision: to guarantee timely redressal for taxpayers.
In a legal skirmish that ensued, the department, represented by Additional Solicitor General Mr. N Venkataraman, sought to reinterpret the temporal constraints delineated in sub-section (3) of Section 38, contending that their purpose solely pertained to interest calculation under Section 42. However, such a contention, deemed by the judgment scribed by Justice PS Narasimha, would inadvertently furnish the department with undue latitude to withhold refundable sums, contravening the very essence and purpose of the statute.
At the heart of the dispute lay the grievance of the assessee/respondent, who, having claimed an excess of duty owed by the department pursuant to Section 38, found themselves mired in bureaucratic inertia. Resorting to legal recourse, the respondent sought solace in the corridors of the High Court.
With a judicious stroke, the High Court wielded Section 38(3) as its cudgel, compelling the department to disburse the owed sums totaling Rs. 17,10,15,285/- and Rs. 5,44,39,148/- for disparate quarters. In a nod to precedent, the High Court invoked the ruling of Flipkart India Private Limited v. Value Added Tax Officer, Ward 300, affirming the categorical obligation incumbent upon the department to meticulously adhere to prescribed timelines.
With resolute determination, the apex court endorsed the High Court’s verdict, debunking the department’s rationale for withholding refunds beyond stipulated periods and subsequently adjusting them against liabilities arising from post-refund default notices. Consequently, the department’s appeal lay in tatters, with the court decreeing the expeditious disbursal of the owed sums alongside accruing interest as mandated by Section 42 of the Act.
In a symphony of legal advocacy, counsels for both petitioner and respondent sparred in the hallowed halls of justice, weaving intricate arguments to champion their respective causes.
In the annals of jurisprudence, the Commissioner of Trade and Taxes v. FEMC Pratibha Joint Venture emerges as a poignant testament to the judiciary’s unwavering commitment to upholding the sanctity of statutory timelines and ensuring equitable redressal for aggrieved parties.
