Refund. Section 20
(1) No amount representing input tax shall be refundable except in accordance with the provisions of sub-rules (2) and (3).
(2) Subject to the provisions of sub-rule (4), any amount representing input tax relating to the goods which have been sold in the course of export out of the territory of India, or which have been used in manufacturing and the manufactured goods have been sold in the course of export out of the territory of India, shall be refundable in full to the exporting dealer.
(3) Subject to the provisions of sub-rule (4), any amount representing input tax relating to the goods which or the goods manufactured from which have been sold in the State or in the course of inter-State trade and commerce shall be refundable to the extent the input tax exceeds the tax calculated on sales on account of difference in rates of tax at which the input tax has been calculated and the rates at which the tax on sales has been calculated.
Illustration.- 1. Input tax in respect of goods purchased by a VAT dealer D is Rs.10,000/-, D sells these goods in the course of export of goods out of the territory of India. D’s liability to pay tax on account of sales made in the State and in the course of inter-State trade and commerce totals to Rs.8,000/-. D is entitled to a refund of Rs.2,000/-.
2. D purchases goods from VAT dealers in the State for Rs.1,00,000/-. D is charged to tax @10% on these sales. D sells these goods in the State to manufacturers for Rs.1,50,000/- against declarations charging tax @4%. D is entitled to a refund of Rs.4,000.
3. In illustration 2, if D sells goods at a loss in the course of inter-State trade for Rs.90,000/- against declarations in Central form C chargeable to tax @4%, D will be entitled to a refund of Rs.5,400/- and D can carry forward credit of Rs.1,000/- for adjustment with tax liability for the next tax period.
(4) While framing the assessment of a dealer for any period, the assessing authority shall, after such scrutiny of its record and the record maintained by the dealer and after making such enquiries as it considers necessary, determine the output tax, purchase tax, input tax and the amount of tax paid by the dealer for the assessment period. If the assessing authority finds that the sum of tax paid and input tax exceeds the sum of output tax and purchase tax, it shall determine the excess amount and from the excess amount it shall then deduct any amount due from the dealer, whether under the Act or the Central Act and it shall allow from the balance amount refund of the amount determined in accordance with the provisions of sub-rules (1), (2) and (3). If the balance amount falls short of the amount determined under sub-rules (1), (2) and (3), the refund shall be restricted to the balance amount otherwise it shall be allowed in full and the balance left thereafter, if any, shall be carried forward for adjustment with future tax liability. The assessing authority shall, in respect of the amount to be refunded to the dealer, issue to him at his option a refund payment order in form S.T.R. 34 prescribed under the Punjab Subsidiary Treasury Rules or refund adjustment order in Form VAT-G9 and where it fails to do so within sixty days of the date of the assessment order allowing the refund, there shall be paid interest to the claimant at the rate of one per cent per month from the date of the order to the date when the refund payment order or refund adjustment order, as the case may be, is issued to him.
Illustration -D, a VAT dealer is assessed to output tax, purchase tax and input tax at Rs.50,000/, nil and Rs.40,000 respectively. D paid Rs.32,000/- as tax. D sold goods in the course of export out of the territory of India for Rs.10,00,000/-. Input tax in respect of the goods exported is Rs.10,000/-. Nothing is due from D under the Act but Rs.8,000/- is due from him under the Central Act. D’s refund claim of Rs.10,000/- is in order and he is further entitled to carry forward tax credit of Rs.4,000/- to next tax period.
(5) Where a refund of any amount paid by any dealer or other person becomes payable as a result of the order of any appellate or revising authority or any court and the same is not the subject-matter of any further proceedings, such dealer or such other person shall make an application to the officer incharge of the district concerned in case he is the owner of the goods in respect of which penalty imposed under sub-section (8) of section 31 has been quashed or reduced and in other cases to the assessing authority concerned, along with the original copy of the order which constitutes the basis for refund and the authority to whom the application is made shall order the refund of the excess amount in the manner specified in sub-rule (4) and where the said authority fails to do so within sixty days of the receipt of such application, there shall be paid interest to the claimant at the rate of one per cent per month from the date of making the application to the date when the refund payment order or refund adjustment order, as the case may be, is issued to him.
(6) A VAT dealer may on quarterly basis claim refund of input tax in the circumstances specified in sub-rules (2) and (3), by making an application to the appropriate assessing authority in Form VAT-A4 and appending thereto the following documents, namely, –
(i) copy of the return(s) in Form VAT-R1 under these rules and in Form I under the Central Sales Tax (Punjab) Rules, 1957, as applicable to the State of Haryana, for the quarter if not already filed;
(ii) original copies of tax invoices relating to the claim of input tax in respect of the purchase of the goods;
(iii) invoices showing the sale of the goods in the State or in the course of inter-State trade and commerce along with the documents of dispatch and delivery of the goods in other State(s);
(iv) invoices showing the sale of the goods in the course of export out of the territory of India along with the custom clearance certificates and shipping documents; and
(v) such other documents or evidence as the assessing authority may require for its satisfaction relating to the payment of the input tax and the tax leviable on the sale of the goods, wherever applicable.
(7) The assessing authority shall, on receiving an application under sub-rule (6), examine the same and pass an order within thirty days of receiving the application either to allow the refund in full or in part or to disallow the same for reasons to be communicated in writing and where the refund is allowed, it shall issue refund in the manner specified in sub-rule (4) to the applicant. The order passed under this sub-rule allowing the refund shall be provisional and shall be subject to final order of assessment in the case.
(8) Where the dealer is unable to identify the goods purchased with the goods sold, or used in manufacturing and sold, it shall be presumed that the goods purchased have been sold, or they have been used in manufacturing and sold, as the case may be, in the chronological order in which they were acquired.