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2023 (12) TMI 672 - HC - VAT and Sales TaxConstitutional validity of the definition of the term ‘dealer’ as defined under Clause (j) of Sub-section (1) of Section 2 of the Delhi Value Added Tax Act, 2004 - Explanation to Sub-clause (vii) of Clause of Section 2(j) of the DVAT Act, inasmuch as it also includes any corporation or company engaged in commercial banking - HELD THAT:- In terms of Sub-section (2) of Section 3, VAT is payable at the rates as specified under Section 4 of the DVAT Act. Section 5 of the DVAT Act, explains the term ‘taxable turnover’ as the turnover during the tax period subject to adjustments. Sections 6 and 7 of the DVAT Act contains provisions regarding sales that are exempted from tax and certain sales that are not liable to tax. Section 9 of the DVAT Act contains provisions regarding the tax credit. The adjustments of tax credit in essence encapsulates the VAT regime. The machinery provisions, subject to other provisions, restrict the aggregate VAT to the tax at the last point of taxation. Thus, the petitioner’s contention that the Scheme of the Act does not entail a charge on sale of goods, is erroneous. The DVAT Act expressly provides for charge of tax on sale of goods subject to certain exemptions and adjustments provided for under the DVAT Act. The scheme of DVAT Act does provide for credit for the taxes already borne to avoid the cascading effect of tax on sale of goods. However, it would be erroneous to assume that charge of tax in not on the sale of goods. The contention that the petitioner is not liable to pay any tax on sale of goods on the ground that there is no value addition, is insubstantial. The petitioner’s challenge to the constitutional validity of the definition of the ‘dealer’ is founded on ex facie erroneous premise. The same is, accordingly, rejected. In HDFC Bank v. Commissioner of Value Added Tax, Delhi [2016 (10) TMI 1345 - DELHI HIGH COURT], another Coordinate Bench of this Court had, following the decision of M/s Citi Bank v. Commissioner of Sales Tax M/s Citi Bank v. Commissioner of Sales Tax [2015 (12) TMI 1040 - DELHI HIGH COURT], rejected an appeal against the decision of the VAT Tribunal holding that sale of such re-possessed vehicles was subject to the charge of VAT. The said two decisions cover the petitioner’s challenge to the impugned notices demanding VAT, interest, and penalty under the DVAT Act. Petition dismissed.
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