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2018 (10) TMI 1527 - HC - VAT and Sales Tax


Issues Involved:
Challenge to re-assessment order under KVAT Act, 2003 for the year 2012-13; Constitutional validity of Section 174(1) (d) and (e) of KGST Act, 2017; Applicability of GST regime to tax period 2012-13.

Analysis:
1. The petitioner, a jewelry dealer, challenged a re-assessment order dated 31/03/2018 under KVAT Act, 2003, seeking to quash the order raising a demand of &8377; 4,42,72,061. The petitioner's application for rectification was also rejected by the Assessing Authority.

2. The petitioner raised the issue of the constitutional validity of Section 174(1) (d) and (e) of KGST Act, 2017, enforced from 01/07/2017, not applicable to the 2012-13 assessment period. The petitioner argued that the re-assessment order does not stand legally due to the introduction of the GST regime.

3. The Senior Counsel contended that the new GST regime, effective from 01/07/2017, has lacunas due to the non-saving of Entry 54 of List II pre-101st Constitutional Amendment. However, the Court noted that the tax law applicable at the time of the transaction is relevant, and passing the re-assessment order post-GST regime does not invalidate it.

4. The Court emphasized that Section 174 of KGST Act, 2017 saves rights under repealed Acts, including KVAT 2003. The constitutional questions raised are deemed academic as the amendments are not applicable to the 2012-13 tax period.

5. The Advocate General argued that the amendments post-2017 do not affect the validity of the re-assessment order under KVAT Act, 2003 for the tax evasion related to Input Tax Credit. The GST regime is inapplicable to the present case.

6. The Court concluded that the questions raised are academic and do not pertain to the 2012-13 period. The re-assessment order is appealable under Section 62 of KVAT Act, 2003, and the writ petition was dismissed, granting the petitioner liberty to file an appeal within four weeks without limitation objections.

 

 

 

 

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