Revised Returns or CA Certificate, relevant to decide whether Typographical Error Crept in VAT Returns: Delhi HC sets aside Decision of Arbitral Tribunal

The Delhi High Court set aside the Decision of the Arbitral Tribunal and ruled that the Revised returns or Chartered Accountant (CA) Certificate is relevant to decide whether typographical error crept in Value Added Tax (VAT) returns.

The appellant, Lakra Oil Co, has filed the present appeal impugning an order, passed by the Delhi Value Added Tax Appellate Tribunal in appeal no.79/ATVAT/06 captioned M/s Lakra Oil Trading Co v. Commissioner of Trade and Taxes, whereby the said appeal preferred by the appellant was partly rejected.

The appellant is engaged in re-sale of petroleum products and lubricants. The appellant was a registered dealer with the Department of Trade and Taxes at the material time.It is the appellant’s case that a liability of ₹15 lakhs had been incorrectly raised by considering the sales turnover as ₹1 crore.

According to the appellant, there was an apparent error in reflecting the sales turnover as₹1,38,82,000/- as the actual turnover for the relevant period amounted to ₹13,82,000/-. The appellant claims that it had also produced material to establish the same.

The Appellate Tribunal observed that the assessee had not filed the revised returns. Before the Appellate Tribunal, the appellant had filed a copy of the revised returns as well as the certificate issued by the chartered accountant reflecting the correct turnover, however, the Appellate Tribunal did not consider the same on the ground that the same were filed belatedly.

The only question to be examined is whether the Arbitral Tribunal had erred in not accepting that there was a clerical error in reporting the sales as ₹1,38,82,000/- instead of ₹13,82,000/-.

The Bench of Justices Vibhu Bakhru and Amit Mahajan observed that “This Court is unable to concur with the decision of the Arbitral Tribunal to disregard the revised returns or the chartered accountant certificate, which are undeniably relevant for deciding the question whether a typographical error had crept in the returns.”

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