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2021 (3) TMI 635 - KARNATAKA HIGH COURTInput Tax Credit - Audit Report submitted in Form VAT 240 even though such claims were not made while submitting monthly returns - appellant’s grievance is that the Commissioner of Commercial Taxes has wrongly denied the input tax credit based upon the information available in Form No.240 by placing reliance upon the judgment delivered by this Court in the case of Centum Industries Ltd. [2015 (10) TMI 47 - KARNATAKA HIGH COURT] - HELD THAT:- By no stretch of imagination it can be said that merely because the dealer has submitted audited statement of accounts in Form VAT 240 he is entitled for input tax credit. It is pertinent to note that Form VAT 240 is only the audited statement of accounts issued by the Chartered Accountant/Cost Accountant/Tax Practitioner and it can never be construed as returns to compute the net tax liability under Section 10(3) as rightly held by the learned singe Judge. The substantive provision of the KVAT Act i.e., Section 10(3) has to be read harmoniously with the procedural provision of filing of the returns under Section 35 of the KVAT Act. The learned Single Judge was therefore justified in holding that filing of returns within the time prescribed under Section 35 of the KVAT Act is mandatory and based upon the returns filed by a dealer the tax liability is determined after deducting the input tax from output tax. Form VAT 240 can never be treated to be returns in any manner. The learned Single Judge was justified in dismissing the writ petitions as the appellant was claiming input tax credit based upon Form VAT 240 and by no stretch of imagination Form VAT 240 can be treated as a returns for the purposes of claiming input tax credit, especially in the light of the fact that filing of returns to compute the net tax liability has to take place keeping in view Section 10(3) and 10(4) of the KVAT Act. Appeal dismissed - decided against appellant.
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