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2016 (8) TMI 132 - MADRAS HIGH COURT

2016 (8) TMI 132 - MADRAS HIGH COURT - TMI - Input tax credit - revision of the assessment orders - other end dealers not reported their sales turnover - Held that:- So far as the issue relating to reversal of input tax credit under Section 19(15) of the Act is concerned on the ground that the registration certificates of the dealers, from whom the petitioner purchased goods, have been cancelled, they are held to be not a ground to reversal of input tax credit of the purchasing dealer - Therefor .....

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l to reverse the input tax credit under Section 27(2) of the said Act is also erroneous and not sustainable. - With regard to levy of penalty, admittedly there is no allegation that there is any escapement of taxable turnover and when the books were accepted by the Authority, the question of levy of penalty does not arise. - Decided in favor of asessee. - Writ Petition Nos.21572 to 21577 of 2016, WMP.Nos.18450 to 18455 of 2016 - Dated:- 23-6-2016 - T. S. Sivagnanam, J. For the Petitioner .....

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challenged the orders of assessment passed by the respondent for the years from 2009-10 to 2014-15. 3. The Officials of the Enforcement Wing inspected the place of business of the petitioner on 5.1.2015, 6.1.2015 and 7.1.2015 and based on their report, the respondent issued show cause notices dated 30.4.2015 for the relevant assessment years proposing to revise the total and taxable turnover on two grounds namely (i) reversal of input tax credit under Section 19(15) of the Act and (ii) reversal .....

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proposal to levy penalty under Section 27(4) of the Act. With regard to this proposal, the petitioner stated that there is no escapement of taxable turnover and that when the returns based on accounts were accepted by the Assessing Authority, penalty cannot be levied. In this regard also, the petitioner referred to the decisions of this Court. 5. However, the respondent, in a most cryptic and arbitrary manner, did not discuss any of the objections pointed out by the petitioner nor referred to t .....

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d orders of assessment. 6. So far as the issue relating to reversal of input tax credit under Section 19(15) of the Act is concerned on the ground that the registration certificates of the dealers, from whom the petitioner purchased goods, have been cancelled, they are held to be not a ground to reversal of input tax credit of the purchasing dealer in the decision of this Court in the case of Sri Vinayaga Agencies Vs. Assistant Commissioner (CT) [reported in (2013) 60 VST 283] and this decision .....

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r and other products, who claimed refund of ITC under Section 18(2) of the VAT Act respect of the exports made. Though the refund was granted, subsequently notice was issued seeking to withdraw the relief on the ground that its dealer had not reported the sales turnover and remitted tax and an order was passed, withdrawing the relief granted and levying penalty. While considering the said case, it was held that the circular issued by the Commissioner clearly states that so long as the vendor is .....

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. Without taking recourse to that, the Revenue could not deny the claim of the assessee. Going by Rule 10(2) of TN Vat Rules read along with Section 19(1) of the TN Vat Act, it is clear that so long as the purchasing dealer has complied with the requirements as given under Rule 10(2), the claim of the purchasing dealer cannot, by any length of reasoning, be denied by the Revenue. The mere fact that the Revenue had not made an assessment on the assessees vendor, per se, cannot stand in the way of .....

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petitioner was dealer in lubricants, purchasing lubricants from a registered dealer. On inspection, it was found that the vendor/dealer had not filed monthly returns nor paid tax to the Department. Though the petitioner had paid tax to the selling dealer, revision notice was issued proposing that the ITC should be reversed on the failure of the selling dealer in paying the tax. Allowing the said writ petition, it was held that at the time of filing the self-assessment return under Section 22(2), .....

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