M/S Godrej And Boyce Manufacturing Co LTD. vs. The State Of Karnataka

Facts

The petitioner, M/s. Godrej & Boyce Manufacturing Co. Ltd., sought to quash an endorsement dated November 15, 2024, issued by the Assistant Commissioner of Commercial Taxes (Audit)-1.2, and to direct the authorities to sanction a refund of unutilized VAT TDS amounting to Rs. 1,39,49,706/-. The petitioner had received a VAT Deduction Certificate (FORM-VAT-156) for this amount for works contracts executed during the VAT regime. The petitioner requested the authorities to consider this amount as excess payment for the period April-2017 to June-2017 and issue a FORM-VAT-185. However, the petitioner had availed the Karasamadhan Scheme for this period, which restricted rectification of assessment orders. Being aggrieved by the rejection of their request, the petitioner approached the High Court.

Held

The Court did not decide the substantive issues of law or fact. Instead, the petitioner filed a memo seeking to withdraw the writ petition. The petitioner stated that due to the restriction imposed by the Karasamadhan Scheme on rectifying assessment orders for the period April-2017 to June-2017, they desired to opt for an alternative remedy to claim the refund of the unutilized VAT TDS. The petitioner prayed to withdraw the writ petition, reserving their right to claim the refund from the appropriate authority. Following the memo, the Court disposed of the writ petition as withdrawn.

Key Issues

1. Whether the petitioner is entitled to claim a refund of unutilized VAT TDS of Rs. 1,39,49,706/- despite having availed the Karasamadhan Scheme for the period April-2017 to June-2017, which allegedly restricts rectification of assessment orders? (Question of law) The petitioner argued that they could not utilize the FORM-VAT-156 to discharge their VAT liability for any tax period under Section 9A(10) of the KVAT Act, 2003. They sought to treat the amount as excess payment and sought rectification. The petitioner's primary contention was that the Karasamadhan Scheme's restriction on rectification prevented them from utilizing the TDS credit. The revenue's contention, as implied by the endorsement rejecting the request, was likely that the Karasamadhan Scheme barred such rectification or refund claims for the period covered by the scheme.