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2020 (7) TMI 671 - HC - VAT and Sales TaxReversal of Input Tax Credit - levy of penalty - discounts received by the petitioner from the supplying dealers - packing materials purchased by the petitioner from local registered dealers - TNVAT Act. Reversal of ITC on discounts received by the petitioner from the supplying dealers - HELD THAT:- Since Section 19(20) which has been invoked to deny the benefit of ITC, has itself been inserted only with effect from 19.08.2010. Though a Division Bench of this Court had initially held that the provision would operate retrospectively and impact prior assessment periods as well, the Supreme Court in the case of JJAYAM & CO. VERSUS ASSISTANT COMMISSIONER & ANR. [2016 (9) TMI 408 - SUPREME COURT] reversed the aforesaid conclusion of this Court confirming the position that Section 19(20) would operate only from the date of its insertion, prospectively, i.e., from 19th August, 2010. Thus the provision could not have been invoked in the present case, for the period, viz. 2008-09 - The invocation of Section 19(20) in the present case is thus not in order and to this extent, the assessment is quashed. Penalty levied under Section 27(4) to this extent is also quashed. Reversal of ITC in regard to packing materials - HELD THAT:- The petitioner has specifically challenged this reversal relying on the provisions of Section 19(2)(ii) of the Act, which permits the grant of input tax on packing materials, containers and label and other materials used for packing goods. This ground has not been referred to or adjudicated upon by the Appellate Authority and hence, the order of the first respondent is quashed and the matter remitted to the files of the Assessing Officer to be redone de novo after taking into account the submissions of the assessee, in accordance with law. Petition disposed off.
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