The Commissioner of Sales Tax

Ref. No. A/2011-12/50322nd September, 2011

To,

The Commissioner of Sales Tax,

8th Floor, Vikrikar Bhavan,

Mazgaon, Mumbai-400 010.

Hon’ble Sir,

Sub : Time Limit for making Refund Applications in Form 501 under MVAT Act

We hereby make the following submissions with respect to the time limit for making refund applications in Form 501 under the MVAT Act :

The time limit for making refund applications in Form 501 has been curtailed from 36 months to 18 months by amending section 51(7) w.e.f 01-05-2011. This time limit should be made applicable prospectively and not retrospectively for the periods already
completed. The amendment of the section cannot retrospectively curtail the right and time limit earlier given to the dealer.

As per para 3.5.f..iii of the Trade Circular 7T of 2011 this provision is applicable to all the periods for which the time period of 18 months from the end of the relevant year has not expired on 31-03-2011. The explanation given in the Trade Circular 7T of 2011 in para 3.5.f..iii is contrary to the provisions of the law. The said fact was also mentioned in our earlier representation letter No.A/2011-12/318 dtd.06-08-2011 in para 12.

As per the said circular the time limit for making Applications for the period 2009-10 expires on 30-09-2011 ( i.e. 18 months from 31-03-2010) and for the period 2010-11 the time limit expires on 30-09-2012. No reference has been made in the circular regarding the time limit for the period 2008-09. It may be noted that the period of 18 months for 2008-09 expired on 30-09-2010 and the period of 36 months for 2008-09 expires on
31-03-2012.

Thus as per the Circular the time limit for 2008-09 remains at 36 months and expires on 31-03-2012 whereas the time limit for 2009-10 gets reduced to 18 months and expires on 30-09-2011. For the period 2009-10 the dealer believed that he has the time limit available for 36 months upto 31-03-2012. However by the explanation given in the trade circular 7T dtd 04-05-201 the limit has been curtailed to 18 months. Also the time limit for 2009-10 expiring before the time limit for 2008-09 leads to an absurd situation.

Further, 30th September being also the due date for filing the Income Tax returns for assessees required to get their accounts audited under the Income Tax Act and Companies Act , the dealers, tax consultants and Auditors are engrossed in submission of the same and it would be difficult to comply with a curtailed time limit of filing Form 501 for 2009-10 on or before 30-09-2011.

Under the above circumstances, we request you to kindly look into the matter and immediately issue a circular restoring the time limit as was applicable before the amendment to section 51(7).

Thanking You in anticipation and expecting speedy grant of refunds to the dealers.

Yours Faithfully,

For The Sales Tax Practitioners’ Association of Maharashtra,

Hiten S. ShahPranav P. Kapadia

PresidentConvenor – Law & Representation Committee

CC to – Shri. R. R. Patil, Jt. Comm.of Sales Tax, Mumbai.