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2015 (12) TMI 782 - HC - VAT and Sales TaxReversal of ITC - Violation of principle of natural justice - Held that - When the respondent-Assessing Officer has applied the ratio laid down by the Calcutta High Court in Crompton Greaves s case (2014 (9) TMI 337 - CALCUTTA HIGH COURT), which cannot be done, in terms of Section 19(20) of the TNVAT Act, this is a fit case for the petitioner to appeal only before the appellate authority. - Decided against assessee.
Issues:
1. Challenge to the correctness of the impugned order passed by the Assistant Commissioner (CT), Chrompet Assessment Circle, Chennai, alleging violation of principles of natural justice and failure to apply Circular Letter No.BD3/44278/2010. 2. Assessment of discount received during the year for quantifying the reversal of ITC leading to a reduction in output turnover and alleged loss of tax to the Government. 3. Reliance on a decision of the Calcutta High Court in a case unrelated to the issue in dispute. 4. Dismissal of the Writ Petition without delving into the merits and directing the petitioner to approach the appellate authority. Analysis: 1. The writ petition was filed by M/s.SLT Cement Marketers Pvt. Ltd. challenging the correctness of the impugned order passed by the Assistant Commissioner (CT), Chrompet Assessment Circle, Chennai. The petitioner contended that the respondent violated the principles of natural justice by not applying Circular Letter No.BD3/44278/2010, resulting in the assessment of discounts received during the year for the purpose of reversing ITC. It was argued that this action caused a considerable reduction in output turnover, leading to a loss of tax to the Government, which, according to Section 19(20) of the TNVAT Act, 2006, should not have been done. The petitioner sought interference by the Court under Article 226 of the Constitution of India. 2. The petitioner challenged the impugned order by highlighting that the respondent relied on a decision of the Calcutta High Court in Crompton Greaves Ltd. v. Assistant Commissioner (CT), which was deemed irrelevant to the present issue. It was emphasized that the application of the Calcutta High Court's decision in the present case was not permissible under Section 19(20) of the TNVAT Act. The petitioner argued that the matter should have been appealed before the appellate authority instead of being decided based on an unrelated judgment. 3. The High Court, in its judgment, dismissed the Writ Petition without delving into the merits of the case. The Court directed the petitioner to approach the appellate authority for further proceedings. No costs were awarded, and the connected Miscellaneous Petition was also closed as a consequence of the dismissal of the Writ Petition. This detailed analysis encapsulates the issues raised in the legal judgment, the arguments presented by the parties, and the ultimate decision rendered by the High Court in the matter.
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