Punjab's industry, exporters complain of pending VAT refunds
February, 20th 2014
Punjab's business and exporting community today accused the state government of making "inordinate" delay in paying VAT refunds, while questioning its intentions in disbursing "timely" refunds despite rolling out a 'start rating' scheme in this regard.
Many of exporters claimed that the cash flow of various industry verticals, including light engineering sector, auto parts had been hit due to delay in tax refund, while a few of manufacturers who were fed up with the state's "snail paced" refund system, had even planned to shut down their units.
"Industry especially exporters in Punjab are facing problems with regard to VAT refunds as there is a long delay in payment of such refunds by the excise and taxation department, adversely affecting our working capital requirements.
But we feel that the state government is facing cash crunch that is why there is a delay in VAT refund payment," Ludhiana-based handtool exporter S C Ralhan told PTI today.
Punjab Congress had even claimed, while party activist procuring detail through RTI, that as on December 31, 2013, the Value Added Tax (VAT) refund of Rs 380 crore was pending after 90 days of raising the claim.
Ralhan, who is also FIEO's Chairman (North), claimed that out of pending refunds, about Rs 100 crore of VAT refunds, which had been unpaid for last ten months or so, belonged to Punjab exporters.
"I got my VAT refund this month which was due in June last year and on the top of it, an amount of Rs 2.5 crore of refund is still unpaid by the department," claimed Avinash Gupta, a forging exporter and Convenor (Steel forging), Engineering Export Promotion Council.
Jalandhar-based GNA Group Director Ranbir Singh also criticised the state government for not paying VAT refund on time.
"Our Rs 15 crore of VAT refund has been pending for the last 2-3 years. Above all, we are not even allowed to adjust pending VAT refund against fresh tax payment. It seems the state government's intentions are not clear with regard to refunding tax to industry," said Singh whose company is a leading manufacturer of auto parts in the region.
"I am fed up with this system and I now feel like moving to country like USA where it is easy to operate business activity as government systems are fast and transparent," he said.