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2022 (7) TMI 417 - HC - VAT and Sales TaxViolation of conditions of the composition scheme prescribed under the KVAT Act and Rules or not - purchasing goods from outside the State of Karnataka for use in the course of its business - whether prohibition on purchase of goods from outside the State by composition dealer under the KVAT Act does not apply to capital goods? - HELD THAT:- Undisputed facts of the case are, respondent owns a Fast Food Restaturant. He has purchased Refrigerators, Freezers etc., from outside the State as capital equipment to run the restaurant. Its main business is not dealing in the said goods. In the case of SRI. ANANTHA PADMANABHA BHAT VERSUS COMMISSIONER OF COMMERCIAL TAXES IN KARNATAKA, BENGALURU AND COMMERCIAL TAX OFFICER (AUDIT) , BENGALURU [2016 (7) TMI 546 - KARNATAKA HIGH COURT], rightly relied upon by the KAT, this Court has held that the vitrified tiles used in the restaurant owned by the assessee therein, were not sold by him in the regular course of business but they were used for the flooring of the restaurant - It was held in the case that When so fixed in the floor, the Vitrified Tiles ofcourse became the part of the immovable property, and it is beyond the common sense and basic commercial prudence to even comprehend that the Vitrified Tiles fixed on the floor of the restaurant could be treated by an assessing authority as the 'goods in stock' dealt with by the assessee or sold in the course of regular course of business. The assessing authorities trained and well acquainted with the commercial terms, cannot be allowed to take such perverse views. In the instant case, admittedly, respondent is in the Restaurant business. The goods purchased by him are in the nature of capital goods for the Restaurant. Hence, they cannot be considered as 'goods held in stock'. The view taken by this Court in Anantha Padmanabha Bhat’s case is fully applicable to the facts of present case. The questions framed by the Revenue are answered in favour of the assessee - this revision petition fails and it is accordingly dismissed.
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