9911796707
TMI Blog2014 (2) TMI 815X X X X Extracts X X X X X X X X Extracts X X X X ..... her on the facts and circumstances of the present case, the Tribunal has erred in believing that the ITC reduced twice? 2. Whether on the facts and circumstances of the present case, when the provisions made separately, the Tribunal can pass such order to apply only one, which is not in accordance with the main intention of the legislature towards making both the provisions separately in the said Act? 3. On the facts and circumstances of the present case, it is a pure question of law as to the proper interpretation of the said provisions of section 11 (3)(b)(i) and (ii)? Though the real controversy does not come from the above questions framed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t as provided under section 11(3)((b) could be applied only once irrespective of the fact that whether a particular commodity purchased falls in more than sub-clauses of clause (b) of subsection (3) of section 11. The Government, however, contends that if such goods satisfy the descriptions of sub-clause (ii) and (iii) of clause (b) of sub-section (3) of section 11, denial of tax credit would operate twice. The Tribunal reversed the decision of the Assessing Officer and ruled in favour of the respondent assessee, upon which the present appeals have been filed by the State. Section 11 of the VAT Act, as already noted, pertains to tax credit. Clause (a) of sub-section (1) thereof provides that a registered dealer who has purchased the taxab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or to his agent outside the state, or (ii) of taxable goods which are used as raw materials in the manufacture, or in the packing of goods which are dispatched outside the State in the course of branch transfer or consignment or to his agent outside the State (iii) of fuels used for the manufacture of goods. Provided that where the rate of tax of the taxable goods consigned or dispatched by a dealer for branch transfer or to his agent outside the State is less than four per cent, then the amount of tax credit in respect of such dealer shall be reduced by the amount of tax calculated at the rate of tax set out in the Schedule on such goods on the taxable turnover of purchases within the state." It is not in dispute that in the present c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able goods is less than four per cent, then the amount of tax credit in respect of such dealer shall be reduced by the amount of tax calculated at the rate of tax set out in the schedule on such goods. In other words, if the tax credit available to a dealer is less than four per cent, the reduction should be limited to such credit and not more. The Legislature, thus, envisaged that the reduction of tax credit under section 11(3)(b) would in no case exceed four per cent. If the interpretation put forth by the State is accepted, a dealer who has availed of tax credit of 4 per cent would end up surrendering credit by 8 per cent or may be in a given case by 12 per cent. Surely, the Legislature could never have intended the reduction to exceed t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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