Refund

Legislation UpdatesRules & Regulations

G.S.R. 571(E).—In exercise of the powers conferred under sub-sections (1), (2), (3), (4), (8), (9), (10) and (11) of Section 125 and sub-section (6) of Section 124 read with Section 469 of the Companies Act, 2013 (18 of 2013), the Central Government hereby makes the following rules, further to amend the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016, namely –

1. (1) These rules may be called the Investor Education and Protection FundAuthority (Accounting, Audit, Transfer and Refund)Second Amendment Rules, 2019.

(2) The provisions of these rules, Other than rule 6 (i), 6 (iv), 6 (v), 6(vi), 6(vii) and 6 (viii), shall come into force with effect from the 20th day of August, 2019.

(3) The provisions of rule 6 (i), 6 (iv), 6 (v), 6(vi), 6(vii) and 6 (viii), shall come into force with effect from the 20th day of September, 2019.

* Please follow the link to read the detailed amendments notified by the Government: NOTIFICATION

Ministry of Corporate Affairs

[Notification dt. 14-08-2019]

Case BriefsHigh Courts

Meghalaya High Court: A Division Bench comprising of Mohammad Yaqoob Mir, CJ and S.R. Sen, J. dismissed a petition on being infructuous.

The Advocate General A. Kumar has submitted that the Meghalaya Clinker Cess Act, 2015 has been repealed by the Meghalaya Goods and Services Tax Act, 2017; consequently, there was no recovery and no question of refund. He contended that the petition cannot hold shall be dismissed as infructuous. The counsel for the petitioner, A. Saraf has prayed for declaring the Meghalaya Clinker Cess Act, 2015 to be ultra vires and further levy of cess on the manufactured clinker produced in the State shall be beyond the legislative competence of the respondent who shall then be restrained from realizing cess on the manufactured clinker under the above said Act.

The Court considering the status of the Act dismissed the petition on being infructuous. [Star Cement Meghalaya Ltd. v. State of Meghalaya, 2018 SCC OnLine Megh 268, decided on 07-12-2018]

Case BriefsHigh Courts

Delhi High Court: A Division Bench comprising of S. Ravindra Bhat and Anu Malhotra, JJ. allowed an appeal for refund of service tax paid by the appellant under wrong impression.

The appellant was a registered society set up by the Ministry of Finance, Planning Commission, several State Governments and distinguished academicians. It was set up as a centre for research in public economics and policies. Concededly, at the relevant time, service tax was not payable for any of the functions or work undertaken or performed by the appellant-assessee. Tax was levied upon the appellant under a wrong impression that it was liable to pay service tax. Subsequently, upon inquiry, it was informed by the Central Board of Excise and Customs (CBEC) that its activities were non-taxable. Soon thereafter, the appellant sought refund of the tax deposited. The Deputy Commissioner refunded part of the amount but disallowed refund of Rs 11,49,090 on the ground that the application was filed after a lapse of one year and was thus barred by limitation. The appellant unsuccessfully filed an appeal to Customs, Excise and Service Tax Appellate Tribunal (CESTAT). Aggrieved by the same, the appellant preferred the instant appeal.

The High Court perused the record and considered the submissions made by the parties. The Court found favour with the submissions of the appellant that when the amount in question was never payable as there was no levy at all, denying the refund of part payment did not arise and the general principle of limitation would be applicable only from the date of discovery of the fact of mistaken payment. Reference was also made to the Supreme Court decision in CCE v. Krishna Carbon Paper Co., (1989) 1 SCC 150. In the view of the Court, the CESTAT fell into an error while passing the order impugned. Accordingly, the appeal was allowed and the Court set aside the order impugned. The appellant was held entitled to refund of entire amount with proportionate interest. [National Institute of Public Finance and Policy v. CST, 2018 SCC OnLine Del 10812, dated 23-08-2018]

Case BriefsSupreme Court

Supreme Court: The Bench comprising of CJ Dipak Misra and AM Khanwilkar and Dr DY Chandrachud JJ., in an order gave huge relief after a long wait to the 135 homebuyers in Supertech’s controversial Emerald Court housing complex in Noida by directing the refund of their investments.

Supreme Court ordered Supertech to deposit the balance amount of Rs 15 crore with an additional Rs 1 crore as interest in two tranches. Supertech had earlier deposited Rs 20 crore.

Gaurav Agrawal amicus curiae informed that he held extensive discussions with homebuyers and 111 of them submitted affidavits agreeing to receive invested amounts with 12% simple interest per annum.

The Supreme Court Bench has directed to deposit the amount by 30-11-2018. The matter is to be listed in the second week of October 2018. [Supertech Limited v. Emerald Court Owner Resident Welfare Association, Special Leave to Appeal (C) No. 11959 of 2014, order dated 30-07-2018]

Case BriefsTribunals/Commissions/Regulatory Bodies

Maharashtra Real Estate Regulatory Authority: An order was passed by Shri B.D. Kapadnis (Member & Adjudicating Officer, MAHRERA) regarding the complaint filed under Section 12 of Real Estate (Regulation and Development) Act, 2016, for refund of the advance paid by the complainants.

The respondents were not able to convince the complainants that they had all the necessary approvals from the Forest Wildlife Department, hence the complainants had cancelled their booking of a flat in respondent’s project Godrej Emrald after which they had stopped making the payments. Relying on the letter submitted by the respondents dated 16-11-2016 in which development permit was also forwarded, where the letter clearly stated “we are waiting for other approvals from the concerned authorities and will update you once received”, thus inducing the complainants to believe that they did not have all the requisite permissions.

As per the minutes of the meeting of the Standing Committee of National Board for Wild Life held on 3-1- 2017 as well as the letter of the Revenue and Forest Department Mantralaya, Mumbai dated 10-5-2016 the site was afterwards declared not to be in the Eco Sensitive Zone, whereas on the date of cancellation it was in the eco sensitive zone. Hence, on the basis of the facts and circumstance the RERA ordered the respondents to refund Rs 7,35,048  i.e. the advance paid along with 8.15 + 2 % interest from the date of respective payments and also to pay Rs 20,000 as the cost of litigation. [Anant Bagaria v. Godrej Greenview Housing Pvt. Limited, Complaint No. CC005000000000067, decided on 21-11-2017]

Supreme Court Cases

Cases Reported in  2014 SCC Vol. 6 July 14, 2014 Part 3

When collection is illegal, Revenue is obliged to refund such amount with interest as money so deposited is retained and enjoyed by it. Hence, resident/deductor who had deducted tax at source and deposited the same before remitting amounts payable to non-resident/foreign company is entitled to interest on such refund on par with assessee. No discrimination can be shown between assessee and resident/deductor in payment of interest on refund of tax. Further, such refund attracts interest from date of payment/deposit of the tax since it falls under “in any other case” in S. 244-A(1)(b) of IT Act, 1961. Money received and retained without right, carries with it right to interest. Whenever money received by a party which ex ae quo et bono ought to be refunded, the right to interest follows, as a matter of course and the State is not exempted from payment of interest. Union of India v. Tata Chemicals Ltd., (2014) 6 SCC 335