2017 (4) TMI 308 - HC - VAT and Sales Tax

Reversal of ITC - section 19(2)(v) - Interpretation of statute - Held that - the issue involved in this writ petition in respect of ITC reversal u/s 19(2)(v) is covered by a recent decision of this Court in the case of M/s. Everest Industries Limited Versus The State of Tamil Nadu, The Deputy Commissioner (CT) (FAC) 2017 (3) TMI 279 - MADRAS HIGH COURT where it was held that A plain reading of the provisions of sub-section (1) and sub-section (2) of Section 19 of the 2006 Act would show that, as long as specified goods, which suffer tax are used for any of the purposes set out in clauses (i) to (vi) of sub-section (2) of Section 19, the assessee should be able to claim the ITC, with a caveat in so far as clause (v) is concerned, and was decided in favor of petitioner - the matter is remitted back to the respondent for considering the above said issue afresh - appeal allowed by way of remand.

Summary

Issues Involved:
Challenge against assessment order regarding reversal of ITC under Section 19(2)(v) of the Tamil Nadu VAT Act.

Analysis:
The petitioner challenged the assessment order dated 27.01.2017 specifically concerning the reversal of Input Tax Credit (ITC) under Section 19(2)(v) of the Tamil Nadu VAT Act. Although an appeal remedy was available, the court entertained the writ petition as the issue of ITC reversal was covered by a recent decision in favor of the petitioner. The petitioner sought for the matter to be remitted back to the respondent for reconsideration of the ITC reversal in light of the previous court decision.

Upon hearing both sides, the court acknowledged that the issue of ITC reversal under Section 19(2)(v) was covered by a previous court decision. Consequently, the court allowed the writ petition, setting aside the assessment order only in relation to the reversal of ITC under Section 19(2)(v). The matter was remitted back to the respondent for fresh consideration based on the previous court decision. The court clarified that it did not express any view on other aspects of the assessment order, leaving it to the petitioner to comply with or challenge those issues before the Appellate Authority.

The respondent was directed to reconsider the issue of ITC reversal within four weeks from the date of the court order. If the petitioner requested a personal hearing, the respondent was instructed to consider it and provide an opportunity for the same. No costs were awarded, and the connected miscellaneous petition was closed as a result of the judgment.