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2015 (4) TMI 817 - HC - VAT and Sales TaxDenial of input tax credit - Sale of furniture to third parties - Held that - assessee has produced at Annexure-15, the particulars which according to the assessing authority was required to be furnished. Those particulars were not taken into consideration by the First Appellate Authority while passing the impugned order. Same mistake is committed by the Tribunal also. Both the appellate authorities proceeded on the assumption that no documents are produced, which they can take note of to consider the claim of the assessee for input tax credit. The error is apparent on the face of the record. It is a clear case of nonapplication of mind by both the appellate authorities to the materials which were produced before them and therefore the said orders cannot be sustained and it is a fit case where the impugned orders are to be set aside - Matter remanded back - Decided in favour of assessee.
Issues:
1. Input tax credit on furniture intended for re-sale under KVAT Act, 2003. 2. Perversity in the Tribunal's order regarding the input tax credit claim. Issue 1: Input tax credit on furniture intended for re-sale under KVAT Act, 2003: The assessee filed revision petitions against authorities denying input tax credit for furniture sold to third parties. The assessing authority refused credit, citing KVAT Act, Schedule V, and Section 11(3), restricting input tax when self-consumed. Lack of details on opening and closing stock post inter-branch transfers led to denial. The First Appellate Authority dismissed the appeal due to missing stock details. The Tribunal upheld this decision, noting the absence of classified stock amounts. However, the assessee had submitted Annexure-15 with relevant particulars, which both appellate authorities overlooked. The High Court found a clear error in not considering the documents and remanded the matter to the First Appellate Authority for a fresh review. Issue 2: Perversity in the Tribunal's order regarding the input tax credit claim: The Tribunal's decision was deemed flawed for not acknowledging the documents submitted by the assessee. Both the First Appellate Authority and the Tribunal erred in assuming no documents were produced to support the input tax credit claim. The High Court held that this was a case of non-application of mind by the appellate authorities. Consequently, the High Court set aside the Tribunal's order, ruling in favor of the assessee and against the revenue. The matter was remanded to the First Appellate Authority for a thorough reconsideration, instructing a review of all additional documents presented for the first time. In conclusion, the High Court allowed the revision petitions, overturned the appellate authorities' orders, and remanded the case for a fresh review considering all relevant documents provided by the assessee.
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