SUPREME COURT: AUTHORITIES MUST STRICTLY FOLLOW TIME LIMIT TO PROCESS AND ISSUE REFUNDS DELHI VAT ACT

The Supreme Court in the case Commissioner Of Trade And Taxes Versus FEMC Pratibha Joint Venture observed and has held that the department must mandatorily adhere to the time limit for processing and issuing the refunds as stated under Section 38 of the Delhi Value Added Tax Act, 2004.

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The bench comprising of Justice PS Narasimha and Justice PB Varale in the case observed and has stated that the language of Section 38(3) is mandatory and the department must adhere to the timeline stipulated therein to fulfill the object of the provision, which needs to be ensured that refunds are processed and issued ina timely manner.

The court in the case observed and has affirmed the decision of the Delhi High Court.

Further, the court rejected submissions made by the counsel, Additional Solicitor General Mr. N Venkataraman appearing for the respondent that the purpose of the timeline provided as stated under sub-section 3) of Section 38 is only for calculation of interest under Section 42.