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2021 (10) TMI 1027 - HC - VAT and Sales TaxInterpretation of statute - Section 8 (5) of the CST Act - inter-state sale - C-Form - changes brought about by the amending Act of 2002 governs only Section 8 (5)(a) and not Section 8 (5)(b) of the CST Act is right and justifiable? - Whether the Division Bench of the Hon’ble High Court of Karnataka was justified in not considering the Notification No.FD 199 CSL 2002(4) dated 31.5.2002 in the right prospect, though the same was upheld by the Division Bench of the Karnataka High Court in W.A. No.2417 of 2007 dated 02.04.2009 in the case of M/s Volvo India Pvt. Ltd.? - HELD THAT:- Giving effect to the industrial policy 1996-2001, Government of Karnataka issued a notification bearing No.FD:32 CSL 96(II) dated 15.11.1996 under Section 19-C of the KST Act providing for tax exemptions or deferrals. Similarly, a corresponding notification dated 15.11.1996 was also issued under 19-C of Act read with Section 9 (2) of CST Act. The said notification issued under the CST Act exempted/deferred the tax payable under CST Act in respect of goods manufactured and sold in the course of inter-state trade and commerce by industrial units which are eligible and opted for the benefit prescribed under the notification dated 15.11.1996 issued under KST Act - The assessee had utilized FAVC tax exemption to a certain extent up to 01.04.2002. In the meantime, Section 8 (5) of the CST Act was amended with effect from 11.5.2002, thereby the benefit of tax exemption under Section 8 (5) of CST was made subject to the condition mentioned in Section 8 (4) of the CST Act pursuant to which the notification dated 31.5.2002 was issued by the Government of Karnataka specifying that exemption of tax shall be subject to the condition of furnishing declaration ‘C’/’D’ forms by the assessee. It is now pointed by the learned counsel for the parties that said Special Leave Petitions are admitted and C.A. Nos. 473-480/2016 are pending, but no interim order of stay has been granted. In view of aforesaid, we have no hesitation to dispose of this petition answering question of law in favour of assessee and against Revenue subject to the result of C.A. Nos. 473-480/2016 pending before the Hon’ble Apex Court. However, we make it clear that the dispute being confined herein to the exemption claimed in respect of inter-state sales turnover which is not supported by production of ‘C’ or ‘D’ forms, this decision would not come in the way for consequential adjustments. The question of law, with regard to interpretation of statute, is answered in favour of the assessee and against the Revenue - the question with regard to non-consideration of Notification No.FD 199 CSL 2002(4) dated 31.5.2002, does not arise for consideration in view of the first question, being answered in favour of the assessee - appeal dismissed.
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