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The South Tea Exporters Association has sought the intervention of the Tea Board to help them get the refund of value-added tax on time from the Commercial Tax Department.
Association Chairman Dipak Shah told BusinessLine that the outstanding refund from the department has shot up to over ₹13 crore. With exporters continuing to remit one per cent tax on sales, the refund from the department is mounting. He also said that out of the total exports of 100 million kg tea from the South, close to 70 per cent were done by the members of the association, and on payment of one per cent VAT.
Recapping the events that led to the present imbroglio, Shah said, “Until 2007, sales at auction were permitted under three modes – on payment of local tax, export at zero per cent tax on production of Form H within six months of sale and inter-State sales with C Form. It was a smooth run until the sales tax department caught a broker with fake C Forms. There was a breakdown in the system thereafter.”
“Shah said that the exporters took an impromptu decision and abstained from buying at the auction in the first week of July.
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