The court held that the adjustment of refunds across financial years is impermissible under the Settlement Act as no provision allows it; review orders invoking irrelevant statutory powers were quashed.

JUDGMENT :

Jitendra Jain, J.

1. Rule. Rule is made returnable forthwith with the consent of both the parties and the Petition is taken up for final hearing and disposal since the pleadings are complete.

2. By this Petition under Article 226 of the Constitution of India, the Petitioner seeks to challenge review orders all dated 17^th July 2023 for the financial years 2013-2014, 2015-2016 and 2017-2018 passed by the Joint Commissioner of State Tax, Pune under Section 15 of the Maharashtra Settlement of Arrears of Taxes, Interest, Penalties or Late Fees Act, 2022 (Settlement Act) in which invoking provisions of Section 50 of the Maharashtra Value Added Tax Act, 2002 (MVAT Act), refund amount for financial year 2016-2017 is sought to be adjusted against the outstanding demand for the financial years 2013-2014, 2015-2016 and 2017-2018 and consequently seeks to review settlement orders passed under Section 13(1) of the Settlement Act.

Brief facts:-

3. The Petitioner is engaged in the business of manufacturing and sale of machineries and is registered under the MVAT Act. The Petitioner is regularly filing its MVAT returns which are subjected to scrutiny and assessment orders are passed by the Respondents exercising its powers under the MVAT Act which are also carried in appeal by the Petitioner.

PROCEEDINGS FOR THE FINANCIAL YEAR 2013-14, 2016-17 & 2017-18:-

4. For the financial year 2013-2014, on 1^st October 2021, an appeal order came to be passed by the Appellate Authority under the MVAT Act and pursuant thereto tax amount of Rs.1,01,51,134/- was payable by the Petitioner.

5. On 12^th May 2022, an assessment order for the financial year 2017-2018 was passed by the Respondents under the MVAT Act and a demand of Rs.30,40,559/- was raised against the Petitioner.

6. Meanwhile, on 15^th March 2022, the Settlement Act was passed for settlement of arrears of tax, interest, penalty or late fee which were levied, payable or imposed under various Acts administered by the Respondent State.

7. On 12^th May 2022, an appeal order under the MVAT Act came to be passed for the financial year 2016-2017, pursuant to which sum of Rs.2,72,08,381/- was determined as refundable to the Petitioner. The copies of the said appeal order was marked to all the Respondents.

8. On 28^th July 2022, Petitioner filed an application under the Settlement Act for the financial years 2013-2014 and 2017-2018 and as per the said application forms generated on the portal of the Respondents under the Settlement Act, a sum of Rs.26,61,347/- and Rs.9,31,526/- were payable as per the said Settlement Act. These applications were acknowledged by the Respondents under the Settlement Act on 28^th July 2022 itself.

9. On 1^st August 2022, Respondent No.2 passed an order of settlement under Section 13(1) of the Settlement Act for the financial years 2013-2014 and 2017-2018 and arrived at the same figure of the settlement amount which were calculated by the Petitioner in its application i.e. Rs.26,61,347/- for the financial year 2013-2014 and Rs.9,31,526/- for the financial year 2017-2018. Respondent No.2 acknowledged amount under the Settlement Act having been paid by the Petitioner and, therefore, passed an order for waiver of interest, penalty, etc.

PROCEEDINGS FOR THE FINANCIAL YEAR 2015-16:-

10. On 28^th September 2022, an order under the MVAT Act for the financial year 2015-2016 came to be passed whereby sum of Rs.1,41,86,978/- was determined as payable by the Petitioner. The Petitioner immediately, thereafter, on 29^th September 2022 filed settlement application under the Settlement Act for the said financial year 2015-2016 with Respondent No.2 and arrived at a sum of Rs.42,69,775/- as the settlement amount payable under the Settlement Act. The said application was accepted and payment as per the Settlement Act was made by the Petitioner. On 3^rd October 2022 an order of settlement under Section 13(1) of the Settlement Act was passed by the Respondent No.2 acknowledging the payment as per the Settle