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2023 (4) TMI 164 - HC - VAT and Sales TaxAssessment of turnover of the applicant as per Section 4(3) of the Value Added Tax Act or as per Rule 9 of the Value Added tax Rules - applicability of provision of Section 4(3) of the VAT Act in the case of work contract - estimation of value of goods imported out of State on the basis of pro-rata basis against the actual import provided under Rule 9(1) and Clause (e) of the U.P. VAT Act Rules, 2008 - HELD THAT:- The combined reading of Rule 8 and 9 establishes that Rule 8 prescribes the methodology for computation of taxable turnover for all classes of dealer while Rule 9 is applicable for determination of taxable turnover of sales of tax involved in execution of works contract and specifies deductions only for the dealers who are involved in execution of works contract, thus, provisions of Rule 9 are considered to be grant of deductions. This leads to an inevitable conclusion that levy of tax on turnover of sale has to be done in the manner provided in Section 4(3) of the Act and Rules 8 and 9 do not restrict the power of the assessing authority in doing so. Section 4(3) read in harmony with Rule 8 and 9 and the interpretation given by the Tribunal while extending the benefit of Rule 9(1)(e) to the dealer and denying the benefit of computation of tax as per the formula provided under Section 4(3) of the Act does not hold good. The finding recorded by the Tribunal to the extent of non-applicability of Section 4(3) of the Act is hereby set aside and the revisions filed by the assessee/dealer challenging the order passed by the Tribunal are hereby allowed. The revisions filed by the Revenue challenging the benefit extended to the dealer/assessee under Rule 9(1)(e) stand dismissed - matter is remitted back to the Tribunal to compute the tax component as per Section 4(3) of the Act giving the benefit to the dealer/assessee under Rule 9(1)(e) - the question of law raised through these revisions stands answered i.e. in favour of the assessee and against the revenue.
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