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2016 (7) TMI 218 - HC - VAT and Sales TaxValidity of re-assessment - Cancellation of registration certificate - Demand of VAT @12.5% rejecting the benefit of composition scheme - rate of tax on paving bricks/blocks - 4% or 12.5% - distinction between bricks and paving bricks/ blocks - whether the nature of activity is works contract or not - Section 15 r/w Rule 137 of Rule 15 of the Karnataka Value Added Tax Act, 2003 (KVAT) - Held that:- although the KVAT Act or Rules do not prescribe any provision for hearing a dealer prior to cancellation of the certificate issued by the authorities for payment of tax by way of composition under Section 15 of the Act, we are of the view that the principles of natural justice have to be read as part and parcel of Rule 145 of the Rules which deals with cancellation of certificate. If the facts of the present case are further examined, it is not the case of the appellant - revenue that at any point of time, notice was issued under Rule 145 of the Rules, by the concerned officer for cancellation of certificate nor it is even the case of the appellant-revenue that the certificate has been cancelled and notice was given in Form VAT-11. Under these circumstances, if the certificate is not cancelled and order of reassessment has been made, in our view, the same would run counter to the scheme of composition of tax as provided and conceived under Section 15 read with and the relevant Rules referred to above. - Benefit of composition allowed.
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