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2017 (7) TMI 456 - HC - VAT and Sales TaxJurisdiction of Assessment Order passed - inclusion of discount in the taxable turnover of the appellant - The appellant says that since, he had not availed of any Input Tax Credit (ITC), no reversal of the same could have been brought about, as is required under the provisions of Section 19(20) of the 2006 Act, in case, the said provisions is triggered, as was erroneously sought to be done by the respondent - Held that: - A bare reading of the Explanation II(ii) would show that the discount cannot be included in the taxable turnover of an assessee. The Assessing Officer, it appears, has included the taxable turnover by relying upon the circular dated 30.11.2016. Further, the Assessing Officer, in coming to the conclusion that the appellant had sold goods at a price lesser than the price at which the goods were purchased by him, has adverted to the following workings which have been gleaned Form W.W, filed by the appellant for the year 2014-2015. The very basis of the calculation is flawed. The Assessing Officer was required to compare the unit sale price of the goods in issue with the unit purchase price. The inclusion of the opening stock, to our minds, has led to an erroneous conclusion that the appellant has sold the goods at a price lesser than the price at which they had been purchased by him. Before concluding a best judgment assessment, the Assessing Officer is required to reach a satisfaction in this behalf. Clearly, such an exercise has not been carried out by the Assessing Officer. Furthermore, a perusal of the provisions of Section 19(20) would also show that, only if, the Assessing Officer comes to the conclusion that the price of the goods sold is lesser than the price at which they were brought, can he, obtain jurisdiction to adjust the ITC, to the extent the amount of ITC exceeds the output tax on the goods. As indicated herein above, the appellant has not availed of ITC in respect of the subject goods i.e., cement. Therefore, there was no occasion for the Assessing Officer, in any event, to invoke the provisions of Section 19(20) of the 2006 Act. The Assessing Officer is, therefore, directed to redo the assessment - appeal allowed - decided in favor of appellant.
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