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2016 (9) TMI 971 - KERALA HIGH COURT

2016 (9) TMI 971 - KERALA HIGH COURT - TMI - Assessment - taxable turnover - purchase value of material - proviso to Rule 10 (2) (a) of the KVAT Rules - sale of apartment - agreement to sell the apartment - works contract - non-consideration of relevant material by Assessing Officer amounting to an error apparent on the face of the record - whether there is any error apparent on the face of the record to enable the officer concerned to reconsider the matter? - Held that: - the decision in the ca .....

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ow that the assessing officer had merely rejected the same by forming an opinion that all the points raised had been considered. - When questions are specifically raised by the petitioner, the same cannot be ignored by the officer while considering rectification application - the matter requires a re-consideration - petition disposed off - decided in favor of petitioner. - W.P.(C) No. 30021 of 2015 - Dated:- 9-8-2016 - A.M. SHAFFIQUE, J. FOR THE PETITIONER : ADVS.SRI.HARISANKAR V. MENON, SMT .....

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essment year 2010-2011. Ext.P1 is a notice issued under Section 25 (1) of the KVAT Act. The main objection raised by the petitioner to Ext.P1 was in regard to the taxable turnover, which according to the respondents, should be based on the total purchase made by the petitioner during the assessment year. As per the annual return submitted by the petitioner, the turn over reported was .7,84,44,241.99 ₹ and the total purchase was shown as ₹13,09,24,806/-. The proposal was to treat the .....

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as the 306 units were concerned, though the petitioner had purchased materials for construction purposes, there is no works contract. However, Ext.P3 assessment order came to be passed. In Ext.P3, the officer asserted the position that the assessment has been made with reference to the total taxable turnover on the basis of the value of goods purchased in terms of proviso to Rule 10 (2) (a). However, nothing has been mentioned with reference to the number of units which remains unsold or for whi .....

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n order to bring home the position that the absence of any contract being executed with potential purchasers by a builder, there is no works contract. However, by Ext.P6 order, without making any reference to the said contention, the application is rejected. 3. The learned counsel for the petitioner submits that there is error apparent on the face of record insofar as the contention of the petitioner that no contract had been executed with reference to 306 apartments has not been considered by t .....

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ficer was justified in rejecting the said application, as there was no error apparent on the face of the record. He also referred to the judgment of the Apex Court in M/s. Deva Metal Powders Pvt. Ltd v. Commissioner, Trade Tax, U.P. [2008 (16) KTR 482 (SC)], wherein the Supreme Court had considered as to what amounts to a mistake or error apparent on the face of the record and it is held at paragraph 11 as under: Mistake is an ordinary word but in taxation laws, it has a special significance. It .....

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ent if there is merely a mistake in the power to rectify under Section 22, it is not sufficient if there is merely a mistake in the order sought to be rectified. The mistake to be rectified must be one apparent from the record. A decision on a debatable point of law or a disputed question of fact is not a mistake apparent from the record. The plain meaning of the word apparent is that it must be something which appears to be so ex facie and it is incapable of argument of debate. It, therefore, f .....

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ded on the basis that the purchase value of the material has to be considered in terms of proviso to Rule 10 (2) (a) of the KVAT Rules. But in a case where the assessee contends that the said procedure cannot be adopted in view of the fact that there is no sale or agreement to sell the apartments in order to make the assessee a works contractor, the assessing officer is bound to consider the said issue also before arriving at a final finding. If there is non-consideration of relevant materials w .....

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sers. Paragraphs 94, 115 and 117 of the said judgment are relevant, which reads as under: 94. For sustaining the levy of tax on the goods deemed to have been sold in execution of a works contract, in our opinion, three conditions must be fulfilled: (i) there must be a works contract, (ii) the goods should have been involved in the execution of a works contract, and (iii) the property in those goods must be transferred to a third party either as goods or in some other form. In a building contract .....

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