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2022 (1) TMI 861 - Tri - VAT and Sales TaxInput Tax Credit - Intra-state Stock transfer - entitlement to input tax credit on stock transfer made by Unit-II to Unit-I which is stated to be intra-state stock transfer - effect of amendment incorporated in the year 2011 in Section 18 (8) (ix) of the JVAT Act, 2005 - HELD THAT:- In order to claim input tax credit petitioner is bound to establish a case that he is covered under any of the sub-sections of section 18 and is not present in the negative list contained u/s 18 (8) of the JVAT Act, 2005. Intra-state Stock transfer does not appear in section 18 (8) (ix) but merely because of the reason that it does not appear in section 18 (8) (ix) does not make it eligible for a claim of input tax credit. Whether Stock transfer of such goods is eligible for input tax credit or not particularity if such goods are subject to intra-state stock transfer is the point for consideration. The whole purpose of the taxation law intends to ensure that the State is not deprived of its taxation rights and the consumer is not overburdened by paying double taxes and therefore VAT law was brought into force. When intra-state transfer of sock is made practically there is no sale and such goods may be used as raw material or consumed as raw material in course of manufacturing of final product but only at the time of sale of the final product the taxes paid on such goods can be claimed as input tax credit. A Composite reading of the proviso to Section 18 (8)(ix) of the JVAT Act, 2005 clearly shows that where stock transfer of goods are made from the State of Jharkhand to any other state then in terms of the proviso the interest of state of Jharkhand is protected and the consumer is not overloaded with excessive tax and therefore, proportionate input tax credit is allowed on inter-sate stock transfer of goods or inter-state sale of goods. This is not applicable when there is intra-sate transfer of stock. In case of intra-state transfer of stock if input tax credit is claimed and if input tax credit is allowed then the other unit of the Petitioner will be at full liberty to subsequently make an inter-state transfer of stock with no requirement to claim input tax credit as he has already availed the same through its unit-11 which would be undoing the mandate of law in terms of Section 18 (8) (ix) of the JVAT Act, 2005. This Tribunal is of the considered view that the dealer with a common TIN number can definitely claim input tax credit even on raw materials used for the purpose of manufacturing of goods at the time of its end product and not on stock transfer of goods claiming to be an intra-state stock transfer. Amendment incorporated u/s 18 (8) (ix) of the JVAT Act, 2005 - HELD THAT:- This Tribunal is of the considered view that Section 18 (8) (ix) of the JVAT Act, 2005 does not allow expressly or by implication to include allowance of ITC on intra-state transfer of stocks relating to goods which are likely to be used as raw materials for manufacture and subsequent sale within the state of Jharkhand. This Tribunal is of the considered view that the Revision Application does not have any merit - Revision Application is accordingly dismissed.
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