TMI Blog2021 (3) TMI 952X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in Section 14 of the Act instead of 3% as specified in Notification dated 30.03.2007. No time limit has been prescribed under the provisions of the Act for making a claim for additional input tax credit. Therefore, the claim for eligible input tax credit is an indefeasible right which is available to the dealer under the Act without any limitation of time for claiming such credit - In the instant case, the government has prescribed the lower rate of 3% by Notification dated 30.03.2007 and therefore the aforesaid rate was applicable for the tax period from 01.04.2007 to 31.03.2008. Therefore, the petitioner cannot be deprived of the aforesaid statutory benefit and Section 35 of the Act does not curtail the entitlement of the dealer to such statutory benefit to it if such return is not filed within the time prescribed therein. From the communication dated 19.02.2020, it is evident that the tax has not been collected by the petitioner from Toyota Kirloskar Motors Ltd. It is also not in dispute that the petitioner by mistake paid the tax at a higher rate and when Toyota Kirloskar Motors Ltd. has confirmed that such a tax has not been collected by the petitioner, Section 43(1) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isions of Section 39(1) of the Karnataka Value Added Tax Act, 2003 do not permit the authorities under the Act to reduce the tax liability declared by the petitioner in its returns and allow the petitioner the benefit of additional input tax credit that it is entitled to claim under the provisions of the Act? 2. Facts leading to filing of this appeal briefly stated are that during the course of re-assessment under Section 39(1) of the Act by the Assistant Commissioner of Commercial Taxes (hereinafter referred to as 'the Prescribed Authority' for short) for the tax period from 01.04.2007 to 31.03.2008, the petitioner made a claim for additional input tax credit at the rate of 4% as specified in Section 14 of the Act instead of 3% as specified in the notification dated 30.03.2007. The Prescribed Authority rejected the claim of the petitioner on the ground that the petitioner had not made such claim either in the original returns or revised returns. The petitioner had made a claim for refund of ₹ 49,13,539/- on account of an error in charging value added tax at the rate of 12.5% instead of 4% in respect of the sales made by the petitioner to Toyota Kirloskar Moto ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le less the input tax deductible whereas Section 10(5) provides that where the input tax exceeds the output tax payable, the excess amount shall be adjusted or refunded together with interest and the Act does not prescribe any time limit to claim the eligible input tax credit. It is further contended that the claim for eligible input tax credit is an indefeasible right available to a dealer under the scheme of the Act without any limitation in time for claiming such credit. 5. It is also submitted that Section 14 of the Act provides for a special rebating scheme where the deduction of input tax shall be allowed on purchase of goods that are dispatched outside the State other than as a direct result of sale or purchase in the course of interstate trade or commerce to the extent of input tax charged at a rate higher than 4% or any lower rate as may be notified by the Government. It is also submitted that a notification dated 30.07.2007 was issued under Section 14 of the Act, by which the rate of input tax disallowance was reduced to 3% with effect from 01.04.2007. Therefore, for the tax periods between 01.04.2007 to 31.03.2008 and thereafter, the petitioner was entitled to reduced ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C 497, 'COLLECTOR OF CENTRAL EXCISE, PUNE AND OTHERS VS. DAI ICHI KARKARIA LTD. AND OTHERS' (1999) 7 SCC 448 AND 'THE STATE OF KARNATAKA Vs. M/S. MANYATA PROMOTERS PVT. LTD.' IN STRP NOS.329/2014 482-487/2014. 7. On the other hand, learned Additional Government Advocate has submitted that the right to claim input credit tax is not indefeasible right but is subject to the terms and conditions mentioned in the Act. It is further submitted that if the contention raised on behalf of the petitioner is accepted that the input credit tax is an indefeasible right, the purpose of the Act would be defeated. It is further submitted that the benefit of input credit tax can be availed off by the assessee in accordance with law. In support of aforesaid submission, reliance has been placed on the decision in INFINITE BUILDERS, supra and has submitted that the aforesaid decision has not been considered in the subsequent decisions of this Court. 8. We have considered the submissions made by learned counsel for the parties and have perused the record. The Act has been enacted with an object to replace the then existing sales tax system in line with national consensus for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this Act, or in any other law for the time being in force, any amount paid or payable by any dealer under sub-section (1), shall, to the extent it is not due as tax be forfeited to the Government and be recovered from him and such payment or recovery shall discharge him of the liability to refund the amount to the person from whom it was collected. 9. It is also pertinent to note that in exercise of powers conferred by Section 14 of the Act, the Government of Karnataka has specified that deduction of input tax shall be allowed on purchase of goods specified in clause (5) and (6) of Sub-Section (a) of Section 11 of the Act to the extent of input tax charged at a rate higher than 3%. 10. In the instant case, the assessee had claimed the benefit of input tax credit at the rate of 4%. However, subsequently, a claim was made for additional input tax credit at the rate of 1% on account of an error in disallowing input tax credit at the rate of 4% as specified in Section 14 of the Act instead of 3% as specified in Notification dated 30.03.2007. No time limit has been prescribed under the provisions of the Act for making a claim for additional input tax credit. Therefore, the clai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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