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2011 (9) TMI 492 - PUNJAB AND HARYANA HIGH COURT
Denial of Input credit on the ground that dealers from whom materials have been purchased failed to deposit full tax in the State treasury - Held that:- Once the law defines the registered dealer and tax-paid goods, the assessee, i.e., purchasing dealer, produced the bill issued by the registered dealer then his burden is discharged and he cannot be held responsible or he cannot be forced to go around from pillar to post to collect the material in order to get the rebate. To conclude, no liability can be fastened on the purchasing registered dealer on account of non-payment of tax by the selling registered unless it is fraudulent, or collusion or connivance with the registered selling dealer or its predecessors with the purchasing registered dealer is established.