Commissioner, Commercial Tax vs U.P. Petrochemicals Complex/Gail (India) Ltd.

Pankaj Mithal, J.—Heard Sri U.K. Pandey learned counsel for the revisionist. Sri B.K. Pandey, has appeared for the assessee.

All these revisions pertain to the same assessee. They are based upon similar facts and purports to raise a common question of law as to whether the Tribunal is justified in refunding the amount which was not deposited by the dealer himself but by his agent with the return in view of section 42(4) of the U.P. Value Added Tax Act, 2008.

The assessee was granted exemption u/s 4A of the U.P. Trade Tax Act, 1948 and the said exemption was applicable when the U.P. Value Added Tax Act, 2008 (hereinafter referred to as "the Act") was enforced.

On behalf of the assessee the net tax payable was deposited along with the return of the tax submitted in the prescribed manner. The assessee in view of exemption granted u/s 4A of the U.P. Trade Tax Act, 1948 claimed refund of the said amount u/s 42(4) of the Act. The refund so claimed by the assessee has been allowed by the Tribunal by the impugned order dated September 7, 2012.

Sri U.K. Pandey, learned standing counsel, has argued that the tax was not paid/deposited by the assessee himself but by his agent and therefore u/s 42(4)(d) of the Act, he is not entitle to the refund of the amount.

The submission is apparently misconceived inasmuch as the tax has been deposited on behalf of the assessee and in view of the exemption granted u/s 4A of the U.P. Trade Tax Act, 1948, the assessee is entitle to refund the same. The revenue cannot withhold the amount of tax paid/deposited on behalf of the assessee when exemption u/s 4A of the U.P. Trade Tax Act 1948 has been granted.

Section 42(4)(d) of the Act provides that the industrial unit availing of or granted benefit of exemption or reduction in the rate of tax on the turnover of the sale before the commencement of the Act, under erstwhile U.P. Trade Tax Act or the Central Sales Tax Act shall be entitled for exemption by way of refund of the net tax paid along with the return of the tax for the period concerned provided the net tax payable has been deposited along with return of the tax period in the prescribed manner.

The aforesaid provision contemplated payment of tax along with the return of tax for the purposes of exemption by way of refund. The payment of tax as prescribed is relevant and not by whom it is actually paid or deposited. It is therefore, immaterial as whether the tax has been paid by the assessee himself or by his agent. Therefore, if the net tax has been deposited on behalf of the industrial unit, that has been granted exemption under the U.P. Trade Tax Act or the Central Sales Tax Act, the refund of the same would be admissible.

In view of the plain language used in the aforesaid provision, the question regarding as to by whom the net tax has actually been paid is of no significance. It can be deposited by the principal or the agent and once the same has been deposited and the exemption is valid subject to fulfilling the conditions laid down in section 42(4)(d) of the Act, the same has to be exempted by way of refund. In view of above, I find no merit in these revisions. They are all dismissed.