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2016 (3) TMI 1286 - HC - VAT and Sales TaxVires of Section 10(3) of the Karnataka Value Added Tax Act, 2003 - interpretation of statute - petitioners claim that they purchase various taxable goods to be used as inputs and consumables in the manufacture of finished products. In respect of such purchases, the petitioners pay taxes applicable to its selling dealers, and as the said tax paid qualifies as "input tax" under Section 10(2) of the KVAT Act, the petitioners had deducted the same while calculating the net tax liability as per Section 10(3) of the KVAT Act - Held that: - Section 10(3) as it stood originally provided for the assessee to claim credit for the input tax paid, subject to making a claim for the same within the tax period. If the assessee failed to make such a claim within the period, he would. The right to claim input tax credits subject to the right to file corrected returns under Section 35(4) of the Act. Therefore the provisions of Section 10(3) of the Act is a Substantive provision vesting in the assessee a right to get input tax credit subject to the claim be made within the time frame and creating a liability on the assessee to forfeit the right to input tax credit if fails to make the claim on time and the rights on the revenue to demand payment of the input tax claim that is disallowed. Section 10(3) of the KVAT Act, prior to its amendment vide the Karnataka Value Added Tax (Amendment) Act, 2015, shall be read down to enable the petitioners to calculate the net tax liability by deducting the input tax paid on its purchases from its out put tax liability, irrespective of the month in which the selling dealer raises invoices - petition allowed.
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