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2021 (3) TMI 189 - HC - VAT and Sales TaxInput tax credit - Rejection of returns - sales of textile and readymade garments from the registered dealers within the State - In spite of discharge of burden cast under the statute the audit authority passed an order dated 26.12.2014 under Section 39(1) of the Act, rejecting the input tax credit claimed by the appellant - HELD THAT:- In the case on hand, there is no dispute that the assessee produced the true copies of communication certificate, turnover analysis of M/s. Tallam Apparels for the year 2012-13. It is not in dispute that M/s. Tallam Apparels was registered dealer bearing Tin No.29850733495 - From perusal of these documents, it can safely be concluded that the transaction is not a bogus transaction or make believe transaction. Since M/s. Tallam Apparels is not a bogus dealer, as is evident from the documents produced by the assessee, dis-allowing of input tax is incorrect. There cannot be any dispute, that burden is cast on the assessee to establish the transaction to lay a claim for deduction of input tax by production of necessary documents. This Court is of the considered opinion that the assessee has discharged this burden by placing necessary documents. In the case on hand, if M/s. Tallam Apparels has not remitted the tax to the Department, for which assessee cannot be penalized. Therefore, we do not find any justification in interfering with the order of the Karnataka Appellate Tribunal. Under the scheme of the Act, there is no power vested in the authority to proceed against the assessee for non-remittance of tax by his purchaser. This aspect of the matter has been rightly considered by the Karnataka Appellate Tribunal in the right perspective - there are no infirmity in the impugned order recording a finding that the AA and the FAA were wrong in disallowing the input tax credit in favour of the assessee for the purchases made from M/s. Tallam Apparrels. Sales Tax Revision Petition is dismissed.
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