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2009 (3) TMI 872 - HC - VAT and Sales TaxState Development Tax - whether payable by the petitioners in addition to the composition amount mentioned in the compounding scheme? Held that:- The tax payable under the compounding scheme is a composition amount in lieu of the tax payable, is introduced as a simplified method of payment tax overriding the complicated process of assessment wherein the gross turnover and net turnover are being determined. If the State Development Tax is held to be chargeable over and above, the composition amount, for the purpose of determination of the State Development Tax the aggregate turnover and taxable tax are to be determined which may lead to passing, therefore, same complicated procedure of determination of gross and taxable turnover. In the circumstances, the whole object of the compounding scheme would frustrate. Thus State Development Tax is not payable by the petitioners in addition to the composition amount mentioned in the compounding scheme. The circular dated 4.6.2007 issued by the Commissioner of Trade Tax is erroneous and liable to be set aside. Appeal allowed.
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