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2020 (2) TMI 404 - HC - VAT and Sales TaxTransitional credit of entry tax paid - whether the petitioner was entitled to avail transitional credit of entry tax paid by a local dealer under section 88 (6) (a) of the TNVAT Act, 2006? - HELD THAT:- While selling the vehicles to the petitioner and paying the tax under TNGST Act, 1959, the local dealer would have set off the entry tax paid against the TNGST and passed on only the net of the tax paid under TNGST Act, 1959 to the petitioner - Therefore, if at all, the petitioner would have been entitled to transitional credit under Section 88(6)(a) of the TN VAT Act, 2006 of only the net of the tax paid under TNGST Act, 1959 by such dealer and not on the burden of entry tax which was purportedly collected by the dealer from the petitioner illegally. Even otherwise having purchased the motor vehicles from a local dealer in Tamilnadu, transitional input tax credit of entry tax paid under Tamil Nadu Tax on Entry of Motor Vehicles Into Local Areas Act, 1990 under section 88(6)(a) of the T.N. VAT Act, 2006 cannot be countenanced. Transitional input tax credit of Entry tax on the closing stock is not permissible under Section 88(6)(a) of the TN VAT Act, 2006 even if the petitioner had actually imported motor vehicles and paid the entry tax on import of the motor vehicles from other state. If such tax was paid, such tax at best would be available for adjustment in terms of Section 4 of the Tamil Nadu Tax on Entry of Motor Vehicles Into Local Areas Act, 1990 - the petitioner had wrongly availed credit of the Entry tax paid by the local dealer who sold the motor vehicle to the petitioner. The entry tax paid by the selling dealer would have got subsumed into the TNGST Act 1959 paid by the dealer and only net of the TNGST would have been passed on to the petitioner. There are no infirmity in the impugned orders passed by the 2nd respondent on 16.4.2015 and by the 1st respondent on 29.09.2015 - petition dismissed.
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