R.H.G. Constructions vs. State Of Punjab And Another

Held

The Court did not delve into the merits of the petitioner's claim for interest on the delayed VAT refund. Instead, it disposed of the writ petition by directing respondent No.2 to take a decision on the petitioner's letter dated 6.2.2019. This decision was to be made in accordance with the law, by passing a speaking order, and after affording an opportunity of hearing to the petitioner. The Court mandated that this process should be completed within a period of one month from the date of receipt of the certified copy of the order. No specific finding was given on the entitlement to interest or the amount thereof, as the Court focused on procedural compliance.

Facts

The petitioner, RHG Constructions, Ludhiana, engaged in construction works, filed its returns for the financial year 2016-17. The petitioner was entitled to a refund of VAT amounting to ₹37,20,982/- for the period from 1.4.2016 to 30.6.2017, as the tax collected by the State exceeded its output tax liability. The petitioner applied for this refund in Form VAT 29. While the refund amount was eventually credited to the petitioner's account, it was without any interest. The petitioner subsequently sent a letter on 27.8.2018 seeking the refund and another letter on 6.2.2019 requesting interest on the delayed VAT refund. Having received no response to the latter, the petitioner filed a writ petition seeking a mandamus directing the respondent (State of Punjab and another) to issue the refund of ₹55,815/- on account of interest on the delayed VAT refund.

Key Issues

1. Whether the petitioner is legally entitled to interest on the delayed VAT refund for the period from 1.4.2016 to 30.6.2017, as per the relevant provisions of the Punjab Value Added Tax Act, 2005, or any other applicable law. Petitioner's contention: The petitioner argued that it had made a representation to respondent No.2 on 6.2.2019 seeking interest on the delayed VAT refund, but no action had been taken thereon. The petitioner sought a direction for the issuance of this interest amount. Revenue/State's contention: The judgment does not record any specific arguments or contentions from the respondents. The Court proceeded to dispose of the petition after hearing the petitioner's counsel.