Bihar VAT Act | Penalty Imposable U/S 56(4)(B) On Account Of Clerical Mistake In Mentioning Of Invoice Number In Suvidha Form: Patna High Court

Patna High Court has ruled that penalty is imposable under section 56(4)(b) of the Bihar Value Added Tax Act, 2005 (Bihar VAT Act) on account of clerical mistake in mentioning of invoice number in SUVIDHA Form.The above ruling came in a case filed by the petitioner, M/s Ceat Ltd. engaged in the manufacture and sale of tyres, tubes and flaps who was concerned with a penalty order passed under Section 60(4) (b) read with Section 56(4) (b) of the Bihar Value Added Tax Act, 2005 after detention of a...

Bihar Entry Tax Act | Adjustment Of Entry Tax Paid On Damaged Cement Against VAT Liability Not Admissible: Patna High Court

In affirming the directive of the Commercial Tax Tribunal, the Patna High Court ruled that the adjustment of entry tax paid on damaged cement is not permissible under the Bihar Tax on Entry of Goods into Local Areas for Consumption, Use, or Sale therein Act, 1993. The court reiterated and upheld the tribunal's decision, reinforcing that the provisions of the aforementioned act do not allow for the adjustment of entry tax in the case of damaged cement.The above ruling came in an appeal arising...

Agreement To Provide Manpower For Maintenance Is Contract Of Service And Not A Sale Under MVAT Act: Bombay High Court

The Bombay High Court has held that an agreement to provide manpower to perform maintenance is a contract of service and not a sale contract under the MVAT Act.The bench of Justice K. R. Shriram and Justice Neela Gokhale has observed that the pith and substance of the contract or true nature of the transaction show that the contract is a contract for service simpliciter and is not a works contract or composite contract consisting of two contracts, one for service and one for sale, but is an...

UP VAT Act | Enhancement Of Turnover Not A Necessary Consequence To Rejection Of Books Of Accounts: Allahabad High Court

The Allahabad High Court has held that turnover cannot be enhanced merely based on rejection of books of accounts. There has to be material as to suppression of turnover by the assesee to indicate evasion of tax.Relying on various judgments of the Allahabad High Court, Justice Piyush Agrawal held “Once the findings of fact has been recorded in favour of the petitioner, there is no cogent reason for enhancing the turnover. The tribunal was not justified in confirming the enhancement of turnover...

Kerala High Court Rejects Assessee ’s Claim For Service Tax Refund To Meet VAT Demand On Pest Control Contract

The Kerala High Court has rejected the assessee's claim for a service tax refund to meet the VAT demand on the pest control contract.The bench of Justice Anu Sivaraman has observed that the claim of the petitioner that the service tax authorities must be directed to meet the demand for VAT, if any, found payable by the petitioner cannot be accepted.The petitioner or assessee is in the business of pest control. As per the assessee, pest control falls under the category of a service contract and...

UPVAT Rules | Stricter Approach To Be Followed Before Giving Benefit Of Exemptions/ Deductions: Allahabad High Court

The Allahabad High Court has held that though in case of doubt, taxing statues are to be interpreted in favour of the assesee. However, a stricter approach needs to be followed before giving the benefit of exemptions and deductions.“The general rule of law in taxing statutes is that in case of any doubt the benefit should be given to the assessee. However, in case of exemption and deduction to be given, a stricter approach may be followed, as per catena of judgments of the Supreme Court, to...

‘Kurkure’ And ‘Cheetos’ Classifiable As ‘Namkeen’, Not ‘Snacks’ Under VAT Act: Rajasthan High Court

The Rajasthan High Court has held that ‘Kurkure’ and ‘Cheetos’ are classifiable as ‘namkeen’, not 'snacks' under the VAT Act.The bench of Justice Sameer Jain observed that the department neither sought any technical or expert opinion nor brought any evidence on record to prove their point. It appears that the Tax Board merely relied on a basic Google search result wherein the goods, namely ‘Kurkure’ and 'Cheetos', were described as Namkeen snacks.The petitioner-assessee is in the sale of various...

UP VAT | Burden To Prove Purchase From Registered Dealer On Assesee: Allahabad High Court

In a revision preferred by the Tax Department, the Allahabad High Court has held that the burden to prove that purchases were made from registered dealer lies on the Assesee claiming the same. The Department cannot be made to discharge a negative burden to prove that the sales were made from unregistered dealers. Perusing Section 16 (Burden of Proof) of the Uttar Pradesh Value Added Tax Act, 2008, bench comprising of Justice Piyush Agrawal held,“It is evidently clear that the burden of proof...

KVAT Act | Tax Doesn't Apply To Transfer Of Goods But To Transfer Of 'Right To Use' Goods: Kerala High Court

In a significant ruling, the Kerala High Court recently held that the tax under the KVAT Act applied not to the transfer of goods but to the transfer of the right to use goods.A division bench of Justice A.K Jayasankaran Nambiar and Justice Mohammed Nias CP added that the taxable event occurs when the contract for goods delivery is executed, irrespective of whether the transfer is exclusive."...in a contract for the transfer of the right to use the goods, the taxable event is the execution...

Patna High Court Orders Railways To Refund Illegal VAT Deduction from Contractors' Bills

In a significant ruling, the Patna High Court has directed the Indian Railways to refund an amount of Rs. 38,22,897 to PCM Cement Concrete Pvt. Ltd., following an illegal VAT deduction made from the bills of the contractor.The division bench of Chief Justice K. Vinod Chandran and Justice Partha Sarthy held, “The transaction was purely of an inter-state sale of goods and is not a works contract nor a sale of goods eligible to tax within the State of Bihar. The sale of goods as per Annexure-2 and...

Goa Value Added Tax (12th Amendment) Act, 2020 Defies The Doctrine Of Separation Of Powers: Bombay High Court

The Bombay High Court has held that the Goa Value Added Tax (12th Amendment) Act, 2020, is an impermissible judicial override defying the doctrine of separation of powers.The bench of Justice M. S. Sonak and Justice Bharat P. Deshpande has observed that by simply not issuing sanction orders or delaying the issue of sanctions indefinitely or unreasonably, the state cannot arbitrarily deprive the parties' interests by way of compensation. A deprivation would fall foul of Articles 14, 265, and...

VAT Act, Madhya Pradesh High Court Directs Dept. To Refund Pre-Deposit With 6% Interest

The Madhya Pradesh High Court has directed the state/commercial tax department to refund the pre-deposit amount paid during the appeal with 6% interest to the assessee.The division bench of Justice Sushrut Arvind Dharmadhikari and Justice Prakash Chandra Gupta has observed that even though there is no provision for payment of interest on the refund of amounts so collected under the VAT Act, the petitioner would be eligible for 6% interest per annum w.e.f. April 17, 2017, until the date of...