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2018 (7) TMI 149 - HC - VAT and Sales TaxTaxability - materials like sand, jelly, bricks, etc purchased from unregistered dealers were held to be taxable - Commissioner of Commercial Taxes, Zone-I exercising powers under Section 64(1) of the Act revised the said order of the First Appellate Authority, and the order of First Appellate Authority was set aside restoring the order of the Assessing Officer relating to the tax periods April 2005 to March 2009 - Jurisdiction. Whether the Revisional Authority is justified in law in holding that the appellant is liable to purchase tax U/s 3(2) of the Act? - Held that:- To attract Section 3(2), the relevant factors to be satisfied are: i) Registered dealer or a dealer liable to be registered under the Act purchasing the taxable goods from the unregistered dealer; ii) Such purchase from the unregistered dealer is for use in the course of business of the registered dealer. If these two conditions are satisfied, registered dealer is liable to pay tax u/s 3(2) of the Act - once the taxable goods purchased from the unregistered dealers are used for development of their own property in the course of the business of the registered dealer, liability to pay tax u/s 3(2) of the Act arises. The decision of the Revisional Authority that the activity of formation of layout is a ‘business’ is in conformity with the provisions of the Act, merely for the reason that no input tax credit can be claimed by the dealer, on this transaction, no liability u/s 3(2) arises, is only a misconceived notion of the Assessee and cannot be acceptable - the subsequent transactions of the URD purchased goods is immaterial for the purpose of levy of tax under Section 3(2) of the Act - demand of tax upheld. Jurisdiction - validity of proceedings by the Addl. Commissioner U/s 64(1) of the Act - Held that:- The order of the Appellate Authority is not only erroneous but prejudicial to the interest of the revenue as discussed above. The twin test i.e., [i] the appellate order being erroneous and [ii] prejudicial to the interest of the revenue, being satisfied, the proceedings initiated by the Addl. Commissioner of Commercial Taxes is well within the scope and ambit of Section 64(1) of the Act. The action of the Revisional Authority cannot be held to be without jurisdiction. Appeal dismissed - decided against appellant.
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