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2020 (9) TMI 115 - HC - VAT / Sales TaxValuation - allegation that the freight charges and pumping charges have been separately shown in the invoices without including the sale and sale price - Levy of tax and penalty - Rule 8(2) of TNVAT Rules 2006 - HELD THAT - Hon'ble Division Bench of this Court, in a recent decision M/S. LARSEN TOUBRO LIMITED VERSUS STATE OF TAMIL NADU REP. BY THE JOINT COMMISSIONER (CT) 2019 (1) TMI 711 - MADRAS HIGH COURT had held that the cost of freight and delivery or cost of transportation cannot be included in the sale price, where they are separately charged and when the freight charges and pumping charges have been separately shown in the invoices without including the same in the cost of the goods, the tax cannot be levied on the same. This clarification of the Division Bench was made pursuant to the impugned orders passed in the present writ petitions, which has not been brought to the notice of the authorities. Petition disposed off.
Issues:
Levy of tax and penalty based on TNVAT Rules 2006 excluding freight charges; Separate invoicing of freight and pumping charges without including in the sale price. Analysis: The writ petitions in question involve the proposed levy of tax and penalty by the authorities under Rule 8(2) of TNVAT Rules 2006, excluding freight charges as post-sale charges separately invoiced. The petitioner's grievance primarily concerns the separate invoicing of freight and pumping charges without including them in the sale price. Notably, a recent decision by a Division Bench of the Court in the case of M/s.Larsen & Toubro Limited Vs. State of Tamil Nadu clarified that when freight charges are separately shown in invoices without being included in the cost of goods, tax cannot be levied on them. This clarification was not brought to the notice of the authorities issuing the impugned orders in the present writ petitions. The Court, considering the Division Bench's decision and the circumstances, set aside the impugned orders dated 16.08.2011 and 22.08.2011, remanding the matters back to the first respondent for reconsideration. The petitioner is granted liberty to present the Division Bench's decision before the authorities for reconsideration. During this process, the petitioner can submit objections along with relevant decisions, and the first respondent must consider them in accordance with the law and pass appropriate orders within three months from the date of this order. As a result, the writ petitions have been disposed of with no costs, and connected miscellaneous petitions are closed.
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