9911796707
TMI Blog2020 (2) TMI 364X X X X Extracts X X X X X X X X Extracts X X X X ..... ions, the Petitioner has challenged the two impugned orders passed by the Respondent on 05.11.2015 in TIN No. 33581324259 for the Assessment Years 2009-2010 & 2010-2011. The Petitioner was issued two Show Cause Notices dated 02.04.2014 for the respective Assessment Years. The Petitioner was called upon to pay tax on the following three heads: In respect of Assessment Year 2009-10: (W.P. No. 37776 of 2015) (a) 2009-10/Trade discount Rs. 9,13,35,246.00 During the year the Petitioner received Trade discount to a tune of Rs. 9,13,35,246.00 which is treated as value addition and proposed to be assessed to tax @ 12.5%. Tax effect Rs. 1,14,16,906/- (b) Sales of Used car Rs. 23,24,205.00 During the year 2009-2010 the Petitioner sold used ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he issue relating to stock transfer and wrong adjustment of Entry Tax has been dropped for the Assessment Year 2010-2011. However, the demand for sales tax on sale of used cars and Trade Discount have been confirmed in the respective orders. 4. The Petitioner is a dealer of Second Hand motor cars. it availed the benefit of Notification No.79, CT & R (B2), dated 23.03.2007. As per Sl. No. 23 to the said notification, a dealer of used cars/motor vehicle was liable to pay tax at the rate of 4% on the value addition without any Input Tax Credit. This notification was subsequently amended by Notification vide G.O.Ms.No.78, CT & R (B2) dated 11.07.2011-No.II(1) CT R/12(R-20)/2011 by increasing rate of tax to 5%. 5. Since there was also another ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... low for better understanding. "Reduction in the rate of tax payable by any dealer on the sale of following goods to four percent". Item No.23 used cars/Motor Vehicles on value addition without Input Tax Credit. Subsequently a notification was issued in G.O.Ms.No.36 CT & R (B2), dated 01.04.2008 with effect from 01.04.2008 and the same is extracted below:- "Reduction of tax from 12.5% to 4% in respect of tax payable under that by any dealer other than dealer in automobiles including commercial vehicles, two wheelers and three wheelers, on the sale of used motor vehicles which have suffered tax already either under erstwhile Tamil Nadu General Sales Tax Act, 1959 (Tamil Nadu Act 1 of 1959) or the Tamil Nadu Value Added Tax Act, 2006 ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otification No.79, CT & R (B2), dated 23.03.2007. In Paragraph 5, it has been clarified as follows:- " 5. The applicant dealers are dealers in automobiles and hence the first set of notifications is applicable to them. Hence, in view of the above discussion, this committee clarifies that the "Sale of used and re-conditioned Cars" by the applicant-dealers being a registered automobile dealers are liable to tax on value addition without input tax credit and not on entire sale value at 4% upto 11.07.2011 as per Notification No.II(1)/CTR/30(a-5)/2007 in G.O.Ms.No.79 CT & R(B2) Dept, dt 23.03.2007 and at 5% from 12.07.2011 onwards as per Notification No.II(1)/CTR/12 (R-20)/2011 in G.O.Ms.No.78, CT&R (B2) Dept, dated 11.07.2011." 9. The lear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in W.P.No.37775 of 2015 today. The operative portion of the said order reads as under:- "12. I have considered the impugned order and the notices pursuant to which the impugned order came to be passed. There is no dispute that the Petitioner is a dealer in motor cars and had received trade discount from the manufacturer from whom it had purchased the cars for retail sales at its show rooms. The trade discount which has been offered by the dealer is an incentive given by the manufacturer based on the performance of the Petitioner in the retail market. The trade discount offered by the manufacturer to the Petitioner does not in any manner enhance the taxable value of the motor cars sold by the Petitioner to the retail buyer at its show r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i) the issue relating valuation is answered in favour of the Petitioner. Thus, the demand of tax on Trade Discount in the impugned orders are quashed to that extent. ii) As far as the issue relating to rate of tax is concerned, the same is remitted back to the respondent to pass fresh order in the light of the clarification issued by the Authority for Clarification and Advance Ruling vide its order dated 25.10.2016. iii). The operative portion of the impugned order on the issue relating rate of Tax may be treated as a show cause notice and if necessary, the respondent may issue appropriate corrigendum to the petitioner within a period of one month from date of receipt of copy of this order. iv) The petitioner shall thereafter file a ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
