TMI Blog2011 (9) TMI 896X X X X Extracts X X X X X X X X Extracts X X X X ..... x paid on purchases was also recovered from the buyers along with tax payable under section 6 of the Kerala Value Added Tax Act, the input tax credit on opening stock is rightly demanded as reverse tax in terms of the second proviso to section 11(13) of the Kerala Value Added Tax Act read with sub-section (7) thereto. We notice that the demand is made under the statutory provisions based on the findings of facts with regard to the failure of the assessee to pass on the input tax credit availed of to the buyers/customers. Decided against assessee. - O.T. Rev. No. 54 of 2009 - - - Dated:- 6-9-2011 - RAMACHANDRAN NAIR C.N. AND GOPINATHAN P.S., JJ. The judgment of the court was delivered by C.N. RAMACHANDRAN NAIR J. The short questi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e tax in terms of the second proviso to section 11(13) of the Kerala Value Added Tax Act. In the course of assessment for 2005-06, the assessing officer noticed that the assessee showed an unusually huge opening stock for the year, which was above ₹ 1.60 crores, whereas the opening stock for the previous year 2004-05 was only 25 per cent of this amount. The assessee, however, explained the unusual closing stock on March 31, 2005 which happens to be the opening stock for the year 2005-06 by contending that huge bank advance was taken and the same was fully utilised for purchase of goods. After accepting this contention, the assessing officer proceeded to consider the gross profit obtained by the assessee on the sales made for the fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is this order which is confirmed in two level appeals by the Deputy Commissioner (Appeals) and by the Tribunal. After hearing both sides what we notice is that the findings based on which disallowance was confirmed by the Tribunal are only on findings of fact based on accounts and audit statement filed in Form 25A, wherein from the gross profit accounted it was clearly established beyond doubt that the assessee had not passed on to the customers the sales tax paid on purchases of goods held as opening stock in respect of which input tax credit was availed of by the assessee. Since the tax paid on purchases was also recovered from the buyers along with tax payable under section 6 of the Kerala Value Added Tax Act, the input tax credit o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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