Madras High Court Quashes The Criminal Proceedings Against Guarantor Of Assessee, For Assessee’s Failure To Pay Tax; States It's Only Contractual Liability And Not Criminal

The Madras High Court has quashed criminal proceedings against the guarantor of the assessee for failing to pay the tax dues of the latter to the Commercial Tax Department. The Commercial Tax Officer (CTO) filed a private complaint before the Judicial Magistrate against the assessee as well as the petitioner, who stood as a guarantor with respect to the tax arrears of the business done by the assessee. The Court remarked that though the petitioner had executed an undertaking or a...

KVAT Act | Dealer Claiming Input Tax Credit Must Prove Transaction Beyond Reasonable Doubt : Supreme Court

The Supreme Court has held that under Section 70 of the Karnataka Value Added Tax Act, 2003, a dealer claiming Input Tax Credit on purchase ought to prove and establish actual physical movement of goods and genuineness of transaction. It noted that in order to establish the same, the dealer should furnish the name and address of the selling dealer, details of the vehicle which has delivered the goods, payment of freight charges, acknowledgement of taking delivery of goods, tax invoices and...

VAT Department Not To Initiate Coercive Measures Against PSU Pawan Hans: Delhi High Court

The Delhi High Court has granted a stay to helicopter charterer PSU Pawan Hans Ltd. against a VAT demand of Rs. 176 crores.The division bench of Justice Vibhu Bakhru and Justice Amit Mahajan has observed that the issue needs consideration and directed the VAT department not to initiate coercive measures for recovery of the VAT demand confirmed by the Delhi VAT Tribunal in the interim.The appellant/assessee stated that it is in the business of chartering helicopters and has entered into...

State Of Tripura Has No Jurisdiction To Levy VAT For Supply Of LPG Cylinder Under Work Orders Executed Outside The State: Tripura High Court

The Tripura High Court has ruled that the State of Tripura has no jurisdiction to levy VAT under the Tripura Value Added Tax Act, 2004 (TVAT), on transport or supply of LPG cylinders to Tripura under the work orders executed outside the State. The bench of Acting Chief Justice T. Amarnath Goud and Justice Arindam Lodh held that that the situs of the sale would be the place where the contracts were executed. The Court further held that transport of LPG cylinders by the assessee under the...

VAT Act Do Not Provide For The Registration Of FIR: Punjab And Haryana High Court Quashes FIR For Alleged Tax Evasion

The Punjab and Haryana High Court has held that the provisions of the VAT Act do not provide for the registration of the FIR, and since the VAT Act is a code in itself, the provisions of the IPC also cannot be invoked. Therefore, an FIR could not have been registered against a person who has allegedly evaded tax.The single bench of Justice Jasjit Singh Bedi has observed that there is no provision for the registration of an FIR in matters such as those of alleged tax evasion. The provisions of...

VAT Defaulter Not Liable To Pay Collection Charges If Opts Amnesty Scheme: Kerala High Court

The Kerala High Court has held that collection charges are not payable if a VAT defaulter opts for the Kerala Amnesty Scheme, 2017.The single bench of Gopinath P. has noted that the petitioner had settled the liabilities in terms of the provisions contained in the Amnesty Scheme of 2017, which was introduced by the provisions contained in the Kerala Finance Act 2017.The court stated that as per the provisions of Section 31A(2) of the Kerala Finance Act, 2017, the assessee/defaulter will not be...

No Legislative Competence To Amend KVAT Act After Introduction Of GST Act: Kerala High Court

The Kerala High Court has held that legislative competence to amend the Kerala Value Added Tax (KVAT) Act after the introduction of the GST Act is impermissible.The division bench of S.V.Bhatti and Justice Basant Balaji has observed that the amendment made by the Finance Act of 2018 to the provisions of the erstwhile KVAT Act to enable the department to initiate assessment proceedings in respect of assessments pending as of March 31, 2018 was illegal because the KVAT Act has already been...

10% VAT Payable On Insulated Glass: Allahabad High Court

The Allahabad High Court has held that 10% Value Added Tax (VAT) is payable on insulated glass.The single judge bench of Justice Saumitra Dayal Singh has observed that insulated glass is nothing but double glazed dual sheet (DGDS). The department has filed the revision against the order passed by the Trade Tax Tribunal. In that order, the Tribunal has allowed the assessee's appeal and held that insulated glass manufactured and sold by the assessee falls within the general description of...

Dept. To Follow Procedure Set Out In Circular On The Issues Of Mismatch: Madras High Court Quashes VAT Assessment

The Madras High Court bench of Justice Anitha Sumnath has quashed the VAT assessment and directed the department to follow the procedure set out in the circular regarding the issue of mismatch. The petitioner has challenged the assessment order passed under the provisions of the Tamil Nadu Value Added Tax Act, 2006 for the period 2013–14. The substantial addition to turnover was on the ground of a mismatch of particulars between the details contained in the returns filed by the...

Cash Sales Accepted By VAT Dept. Not Sufficient To Hold It To Be Genuine: Himachal Pradesh High Court

The Himachal Pradesh High Court has held that the cash sales accepted by the VAT department are not sufficient to hold that the cash sales were genuine. The division bench of Justice Sabina and Justice Satyen Vaidya has held that the Assessing Officer was liable to independently look into the cash sales to come to a conclusion as to whether the said sales were genuine or not. The Assessing Officer, as well as the Appellate Authority, rightly gave the finding of fact that the cash sales...

Telangana High Court Holds Telangana Value Added Tax (Second Amendment) Act, 2017 To Be Unconstitutional

The Telangana High Court has held that the Telangana Value Added Tax (Second Amendment) Act, 2017 is unconstitutional.The division bench of Chief Justice Ujjal Bhuyan and Justice P. Madhavi Devi has observed that the intention of Parliament in ushering in the GST regime through the Constitution Amendment Act, enactment of the CGST Act and simultaneous enactment of various State GST Acts by the State Legislatures was to avoid a multiplicity of taxes by subsuming those indirect taxes into a...

Madras High Court Upholds Validity Of Section 6 Of The Tamil Nadu Value Added Tax Act 2006

The Madras High Court recently upheld the validity of amendments made to Section 6 of The Tamil Nadu Value Added Tax Act, 2006. The court observed that in matters relating to tax, the interest of the State must be considered as against the interest of certain individuals. The court also discussed the power of the legislature in taking decisions with respect to tax "The hardship that is caused to individuals seldom matters as validity of any fiscal enactment ought to be tested on the...