Delhi HC allows interest on DVAT refund which was sanctioned without interest

Satbir Filing Station Vs Delhi Value Added Tax Officer Ward 101 & Ors. (Delhi High Court)

Delhi High Court ruled in the case of Satbir Filing Station vs. Delhi Value Added Tax Officer Ward 101 & Ors. regarding the computation of interest on a delayed refund under Section 42 of the Delhi Value Added Tax Act, 2017. The petitioner sought interest on a refund that was sanctioned without interest from 01.06.2015 until the date of disbursement on 23.05.2023. The Court noted that according to Section 38(3)(a)(ii) of the Act, the refund claim became due after two months from the date of filing, which was on 01.06.2015. Section 42(1) of the Act mandates the grant of simple interest on delayed refunds, and since the refund was sanctioned without interest, the Court directed the respondents to consider the petitioner’s claim for interest and to disburse it within four weeks if found entitled. The petitioner was granted the right to seek further remedies if aggrieved by any order passed by the respondents.

FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT

1. Petitioner seeks computation/quantification of interest on the delayed refund in terms of Section 42 of Delhi Value Added Tax Act, 2017 w.e.f. 01.06.2015 i.e. expiry of two months from the date of filing of refund of the application till 23.05.2023 when the refund was disbursed to the petitioner.