Home Case Index All Cases VAT and Sales Tax VAT and Sales Tax + HC VAT and Sales Tax - 2014 (12) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2014 (12) TMI 1221 - MADRAS HIGH COURTValidity of impugned order - Manufacturer of industrial pumps, valves and its parts - Petitioner not claimed refund of ITC in form W therefore, required to reverse the ITC relating to the export after deducting the tax dues within 180 days from the date of export as it had lapsed to the Government according to section 18(3) of the TNVAT Act - Held that:- the assessing officer adopted a formula, viz., by stating that proportionate ITC due for refund on zero rated sale. It is seen that this formula adopted by the assessing officer has been done for the first time and such formula was not adopted while issuing show-cause notice dated June 19, 2014. Therefore, if only the dealer had been put on notice referring proportionate ITC due for refund on zero rated sale and proposing to calculate, then only, the dealer would be in a position to submit his objections. If show-cause notice does not disclose the basis to such calculation, then, the dealer would not be in a position to know what is passing in the minds of the assessing officer and that is the reason the dealer would not object to reverse the proposal effectively. Therefore, the resultant consequence would be the impugned proceedings and has travelled beyond the scope of the show-cause notice by adopting the procedure, which was not disclosed to the petitioner at the time of proposal. Hence, the impugned order suffers from serious procedural infirmity and the same is in violation of principles of natural justice. Validity of impugned order - Reversal of ITC under section 19(2) of the Act - Manufacturers of goods within the State and goods purchased from registered dealers which are for the purpose of use in the manufacture within the State - Demand is purely on account of the amendment to section 19(2) by Amending Act 28 of 2013 and sought to justify as to how the said amendment would not affect the petitioner - Held that:- the assessing officer did not advert into any of the objections raised except to state that as per section 19(2)(v), the reversal was proposed as per the amended section; as per the section, there is no exception for manufacturer. The petitioner in their objection/reply elaborately dealt with the issue relating to section 19(2)(v) and the petitioner stated that the said provision was not attracted as the Legislature has not sought to restrict the credit in respect of goods which are for the purpose of use in manufacture or processing within the State. It is seen that the petitioner would state that they being manufacturers, they would fall within clause (ii) of section 19(2), i.e., inputs are for the purpose of use as input in the manufacture or processing of goods in the State. Therefore, the assessing officer while dealing with second issue regarding applicability of section 19(2) did not assign any reasons. Therefore, the impugned order is not valid. - Matter remanded back
|