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2017 (9) TMI 978 - HC - VAT and Sales TaxInterpretation of statute - refund - reversal of credit - Rule 8 (6) of TNVAT Rules, 2007 - Held that - similar issue decided in the case of M/s. CBC Fashion (Asia) Pvt. Ltd. Versus The Assistant Commissioner (CT) 2017 (8) TMI 1203 - MADRAS HIGH COURT , where relying 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 , 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 - the respondent directed to consider the petitioner s letter/representation, dated 01.06.2017, filed on 05.06.2017, taking note of the decision of the Court in M/s. Everest Industries Ltd. s case - petition allowed by way of remand.
Issues:
- Petitioner seeks a Writ of Mandamus for refund of tax amounts for specific years. - Interpretation of proviso to Section 19(2)(ii) of TNVAT Act. - Consideration of previous judgments for similar relief. - State's pending Appeals against similar decisions. - Court's direction for consideration of petitioner's representation. Analysis: 1. The petitioner filed a Writ Petition seeking a Writ of Mandamus to direct the respondent to dispose of their refund application for tax amounts for specific years. The petitioner requested a refund of ?4,18,632/- and issuance of a Refund Voucher in a time-bound manner as per Rule 8(6) of TNVAT Rules, 2007. 2. The Court considered a previous case involving a similar prayer and disposed of it in light of the decision in M/s. Everest Industries Ltd. vs. State of Tamil Nadu. The Court interpreted the proviso to Section 19(2)(ii) of the TNVAT Act, emphasizing the entitlement of a dealer to claim Input Tax Credit (ITC) for specified goods used for specific purposes. 3. The Court's decision in M/s. Everest Industries Ltd. case clarified that the limitation on ITC availment applies only to certain purposes specified in the Act. The Court highlighted the adverse impact of misinterpretation of the proviso on manufacturing industries in Tamil Nadu, leading to a competitive disadvantage compared to neighboring states. 4. The petitioner contended that the reversal of ITC directed to be paid was not tenable based on the legal precedent set by the Court. However, the State opposed the relief sought, indicating pending Appeals against similar decisions. The Court noted that the pendency of Appeals without interim orders does not stay the lower court's decision. 5. Despite the State's pending Appeals, the Court directed the respondent to consider the petitioner's representation within eight weeks, following the decision in M/s. Everest Industries Ltd. case. The Court emphasized the importance of passing appropriate orders on merits and in accordance with the law, providing relief to the petitioner within a specified timeframe. 6. Consequently, the present Writ Petition was disposed of, instructing the respondent to consider the petitioner's representation within twelve weeks, in line with the Court's decision in M/s. Everest Industries Ltd. case. The Court reiterated the need for timely and lawful resolution of refund applications, ensuring justice and compliance with legal provisions.
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