Days after the BJP core committee expressed its concern over the delayed VAT refunds, the government earmarked Rs. 200 crore for VAT refunds in June for the business community.

This amount is four times more than the usual Rs. 45 to Rs. 50 crores, which government disburses as VAT refunds in a month. However, the tough talk of the BJP forced the government to clear the pendency of VAT refunds.

Apart from that the Excise and Taxation Commissioner (ETC) Anurag Verma has held a meeting with the business community of Ludhiana and taxation lawyers to apprise them of the various steps taken to speed up the process of VAT refunds.

The BJP, during a core committee meeting, which discussed the recent poll drubbing, expressed its unhappiness over the delay in the release of VAT refunds to businessmen, a community which is traditionally the vote bank of the saf fron party.

In the elections ,the BJP received a drubbing in the urban areas, as voters drifted to the Aam Aadmi Party. Thus, the BJP talked tough with alliance partners SAD over the issue.

Out of 2.25 lakh registered dealers in the state, only 4,000 (approximately) were regular refund seekers.

The ETC said there was no dearth of funds for the grant of VAT refunds. He said that ever since dedicated refund fund was set up by the deputy chief minister in December 2013, the pendency of refunds had come down from Rs. 547 crore to Rs. 273 crore.

He said that the earlier average monthly outflow of refunds was approximately Rs. 45 crores which had now been doubled to about Rs. 90 crores in order to clear the backlog.

Verma, in a press note issued here, said for June, 2014, funds to the tune of Rs. 200 crores had been allocated to clear all VAT refunds.

Verma admitted that there was a problem in Ludhiana-I because the AETC, Ludhiana-I had to discharge the duties of assistant returning officer (ARO) during the parliamentary elections.

As a result, out of total pendency of refunds of Rs. 273 crores in the entire state, refunds amounting to Rs. 128 crores were pending in Ludhiana-I.

Now the position in Ludhiana-I was being monitored closely and the pendency is likely to be reduced to half within a month. For this purpose, Rs. 60 crores had been allocated to Ludhiana-I for June, 2014, he added.

Excise and taxation lawyers demanded that refunds should be cleared on the basis of ‘first in first out’ principle. Verma agreed to this suggestion and directed the AETC, Ludhiana-I to follow this principle.