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CA Final · Indirect Tax Laws · Demands and Recovery

Rao Pharma has a section 73(9) order for 2019-20 and also a pending demand of Rs 3,00,000 that arose from an erroneous refund granted to it. Separately, it filed a writ petition before the High Court against the order and has not withdrawn it. The Government has notified the date under section 128A(1). Rao Pharma pays the tax under the order in full before the date. Which statement is correct?

Waiver is unavailable for the erroneous refund amount because section 128A(2) excludes it, and unavailable for the order because section 128A(3) excludes cases where the person's writ petition is pending and not withdrawn on or before the notified date.

  1. AWaiver applies to both the order and the erroneous refund amount
  2. BWaiver applies to the erroneous refund amount only
  3. CWaiver is unavailable for the erroneous refund amount, and it is also unavailable for the order while the writ petition remains pending and unwithdrawn on the notified dateCorrect
  4. DWaiver is available for the order, and the pending writ petition does not matter

Explanation

Section 128A(2) excludes amounts payable on account of erroneous refund. Section 128A(3) denies the waiver where an appeal or writ petition filed by the person is pending and has not been withdrawn on or before the notified date. Both conditions defeat the claims in the other options.

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