Refund provisions in various states

Refund provisions in various states :

The gist of refund provisions existing in various States VAT Act is narrated below:

Kerala

Nature of credit Treatment	Relevant Section/Rule	Treatment
Refunds	Sec.89	When an assessing authority finds, on completion of annual assessment, that a dealer has paid tax in excess of what is due from him, it shall refund the excess to the dealer. When an assessing authority receives an order from any appellate or revisional authority or any officer authorised, to make a refund of tax or penalty or cash security paid by a dealer or any other person, it shall effect the refund to such dealer or such other person. The assessing authority shall have the power to adjust the amount due to be refunded towards the recovery of any amount due, on the date of adjustment, from the dealer. In case refund is not made within ninety days of the completion of assessment or of the date of receipt of the order in appeal or revision or the date of expiry of the time for preferring appeal or revision, the dealer shall be entitled to claim interest at the rate of ten percent per annum on the amount due to him from the date of expiry of the said period upto the date of payment or adjustment.
Power to withhold refund in certain cases	Sec.90	Where an order giving rise to refund is the subject matter of appeal or any other proceedings under the Act and the assessing authority is of the opinion that the grant of refund is likely to prejudice the public revenue, it may, for good and sufficient reasons to be recorded in writing withhold the refund until such time as it deems proper. Where a refund is withheld and the matter is finally settled in favour of a dealer, a simple interest of six percent per annum shall be paid for the period commencing from the first day of the order determined, in favour of the dealerand ending the date on which the refund is made, where the assessing authority fails to make the refund within ninety days from the date of receipt of such order by it.
Refund in case of Excess Input Tax credit	Sec.11(6)/rule 47A	If the input tax of a dealer for a return period is more than the Output tax of that return period, the excess ITC shall be first adjusted against any interest, tax or any other amount due from the dealer under the Act for any previous return periods and then against tax payable under the CST Act. Still if there is any excess credit, it shall be carried forward to the succeeding return period for availing the credit. In cases, where the excess ITC carried forward cannot be fully adjusted during the last return period of that year, it shall be refunded to the dealer.Dealer claiming refund of ITC remaining unadjusted at the end of the year has to submit an application in Form No.21CC within 3 months after the expiry of the year to which the input tax relates along with the Closing stock inventory in respect of VAT suffered goods locally purchased during the respective year and held as closing stock as on 31st March, in Form No.54.
Refund of Input tax in the case of export or inter state sale	Sec.13(iv)(a)/Rul e.47	As per Sec.13(2) (iv)(a) input tax paid on goods(other than falling under Fourth Schedule (ie. KGST) which are used or consumed in the manufacture of taxable or non-taxable goods or used as containers or as packing materials of such goods, is entitled to refund if the manufactured goods are exported.
	Sec.13(iv)(b)	Refund of input tax when taxable goods are manufactured and sold interstate.
Stock Transfer		Where input tax paid goods are sent to outside State by way of stock transfer, the refund shall be limited to the amount of input tax paid in excess of 5% on he purchase turnover of such goods.

ANDHRA PRADESH

(1) (a) A VAT dealer effecting sales falling under sub-section (1) or (3) of Section 5 (and sub-section (6) of Section (8) of the Central Sales Tax Act, 1956 in any tax period shall be eligible for refund of tax, if the input tax credit exceeds the amount of tax payable subject to the condition that the exports have been made outside the territory of India. The excess of tax shall be refunded within a period of ninety days on a claim made on a VAT return prescribed to the authority prescribed subject to the provisions of the Act and the rules made thereunder;

(b) In all other cases, the VAT dealer may make a claim for refund of any excess credit available at the end of second year after the commencement of the Act and thereafter in the return to be filed for the month of March every year if registered as a VAT dealer for a minimum period of twelve months or in the event of cancellation of registration. The excess of input tax credit claimed as refund shall be refunded within ninety days of the date of receipt of the claim;

(d) A VAT dealer, who has paid tax in excess of the amount due for a tax period, may claim a credit in the next tax return.

(2) Where a VAT dealer claiming a refund is required by authority prescribed to provide accounts or records to substantiate the claim but fails to do so in a manner satisfactory to the authority prescribed within seven days of issue of notice, the time period specified in sub-section (1) for making the refund shall not apply.

(3) Where a claim of a VAT dealer is not accepted either in full or in part, the authority prescribed, shall send a notice in writing, to the VAT dealer.

(4) A VAT dealer aggrieved by the decision under sub-section (3) may file an appeal as prescribed in the Act.

(5) The tax paid under the Act on the purchases made by specialized agencies of the UNITED NATIONS ORGANISATION and Consulates or Embassies of any country located in the State, or International Crop Research Institute for Semi Arid Tropics, Hyderabad shall be refunded in such manner as may be prescribed.

Provided that, Government may by notification denotify or exclude any of the Organizations, Consulates or Embassies or any other International Institutions from the purview of this sub-section making them not eligible for refund of tax under the Act on the purchases made by them.

(6) Where the authority prescribed fails to make a refund within the time specified under sub-section (1) the amount of refund shall carry simple interest at the rate of one percent per month on the amount of the refund for the period of delay.

(7) A TOT dealer shall be eligible to adjust any excess tax paid by him in the subsequent returns or may claim refund at the time of cancellation of registration in the manner prescribed.

(8)The Government may, by notification provide for grant of refund earlier than the period stipulated in this section, of any excess credit available, after adjusting the tax payable under the Act or any tax payable under the provisions of Central Sales Tax Act, 1956 in respect of any Value Added Tax dealer or any category of Value Added Tax dealers.

(9) The tax paid under the Act, by the person who is not liable to be registered as Value Added Tax or Turnover Tax dealer and not liable to pay tax under the Act, may be refunded in the manner as may be prescribed.

39. (1) Where the authority prescribed is required to refund an amount of tax to a VAT dealer or TOT dealer or any other dealer as a result of:-

(a) a decision under Section 31; or

(b) a decision of the Appellate Tribunal under Section 33; or

(c) a decision of the High Court under Section 35; such refund shall be made within a period of ninety days from the date of the receipt of the order.

(2) Where refund is not made within the stipulated time, as mentioned in subsection

(1) the amount of refund shall carry interest at the rate of one percent per month for the period of delay. The interest in respect of part of a month shall be computed proportionately and for this purpose, a month shall mean a period of 30 days.

40. (1) The Commissioner or the authority prescribed shall have the power to adjust any amount due to be refunded against any tax, penalty and interest outstanding against a VAT dealer or a TOT dealer or any other dealer.

(2) Where an order giving rise to a refund is the subject matter of an appeal or further proceeding, or where any other proceeding is pending, and the authority prescribed is of the opinion that the grant of the refund is likely to adversely affect the revenue, the authority prescribed may, with the previous approval of the Deputy Commissioner, withhold the refund till such time as the Deputy Commissioner may determine.

TAMIL NADU

Sec.18(2) – The dealer, who makes zero rate sale, shall be entitled to refund of input tax paid or payable by him on purchase of those goods, which are exported as such or consumed or used in the manufacture of other goods that are exported as specified in sub-section (1), subject to such restrictions and conditions as may be prescribed.

3) Where the dealer has not adjusted the input tax credit or has not made a claim for refund within a period of one hundred and eighty days from the date of 1[making zero rate sales] accrual of such input tax credit, such credit shall lapse to Government.

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