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TMI Blog2007 (10) TMI 556X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. W.P. dismissed. - W.P. (C) No. 26867 of 2007 - - - Dated:- 18-10-2007 - GIRI V. , J. V. GIRI J. The principal challenge in this writ petition is with regard to the note forming part of form No. 9 in the Kerala Value Added Tax Rules, 2005 (for short, the Rules ) prescribing the format for credit notes and debit notes, that are to be exchanged by a selling dealer and a purchasing dealer in cases where subsequent to the sale of taxable goods by a dealer the purchaser has returned the goods covered by the tax fully or partly. The challenge is on the premise that the note forming part of form No. 9, contained in the Rules is invalid, inoperative and unenforceable to the extent it specifies that every credit note would bear a corresponding debit note and vice versa and the same is, therefore, contrary to section 41(1) of the Kerala Value Added Tax Act, 2003 (hereinafter referred to as, the Act ). There is also a challenge to the order of assessment passed by the assessing authority for the months of April, May and June, 2006. Obviously, the said order of assessment is appealable and this court would be reluctant to entertain the challenge against the order of assessment, u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it notes for the input tax claimed at the time of objecting to the pre-assessment notice. Though almost an year was available to the assessee to produce the debit notes, he was not able to do so. Mere filing of the credit notes given to the purchasing dealer by the selling dealer is not sufficient to allow exemption on account of the return of goods once sold. The assessing authority will not be in a position to ascertain whether credit notes have actually been issued to the purchaser. It is also contended that, in the present case, the assessee did produce some debit notes corresponding to the credit notes issued by him. On verification of the same, the sales return was accepted to the extent where it is proved that the goods, which once sold were returned within a period of 90 days, as provided in law. Essentially, section 41 of the Act enables the selling dealer to claim a credit for a portion of the input tax, where some of the goods which were sold are returned for a variety of reasons. Form No. 9 is in a format that is consistent with section 41 of the Act. It is also contended that the order of assessment is rested on other grounds as well. Essentially section 41(1) deals ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filed by the petitioner reiterating the contentions raised in the writ petition. I have heard learned counsel for the petitioner Sri K.U. Vijayan and learned Government Pleader Mr. Tekchand. Challenge against the order of assessment, exhibit P4, as such will not normally be entertained by this court under article 226 of the Constitution of India, in circumstances where there is an efficacious alternate remedy available to the assessee under the statute. But the assessee has raised a contention with regard to the prescription of form No. 9 in terms of rule 59 of the Rules. According to the assessee, the note appended to form No. 9 is ultra vires section 41 of the Act and consequently, production of a credit note by the selling dealer for the purpose of computing the taxable turnover of such dealer as per rule 10(b) of the Rules should be treated as sufficient compliance with section 41 of the Act. The assessee contends that inasmuch as the note to form No. 9 contemplates a corresponding debit note, the form is ultra vires section 41 of the Act read with rule 59 of the Rules. Since what is involved is a matter which will have recurring application to traders/assessees, I have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n law, is explicit in the provisions contained in the note, which says that the seller and buyer should exchange credit note/debit note mutually. The taxable event in the case of a levy of sales tax, or value added tax, as the case may be, is the sale of taxable goods. Sale of movable goods takes place essentially when the parties to the agreement for sale intend the sale to take place. Where therefore a purchasing dealer purchases goods from the selling dealer pursuant to a requisition made by the former with the latter after the price is realised by the selling dealer from the purchasing dealer and takes delivery of the goods pursuant to such agreement which the parties must have struck, the sale becomes complete, in law. Sale is evidenced by the invoice, which is raised by the selling dealer. When the sale becomes complete, the property in the goods is acquired by the purchasing dealer. The taxable event has actually taken place at that point of time. The charging provision relating to levy of value added tax, has also been enforced. The tax collected by the selling dealer, less the tax, which he must have paid at the time of purchase of the goods, is to be remitted to the Go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... details of a corresponding debit note issued by the purchaser cannot under any circumstance, be treated as an onerous provision or otherwise arbitrary. Essentially, the requirement that every credit note must correspond with a debit note and vice versa and the seller and the purchaser shall exchange the credit note and debit note is only a provision which enables the verification of a claim made by the dealers as to the return of the goods involved in a sale, which otherwise will be treated as completed. The contention that the Note in form No. 9 is ultra vires rule 59 and section 41 of the Act is misconceived. Form No. 9 will have to be treated as part of the Rules, and obviously, the format is statutorily prescribed. Obviously, the petitioner could not have had a grievance even in the manner now sought to be projected in this writ petition, if the Note forming part of form No. 9 was repeated verbatim in rule 59 of the Rules. That the rule-making authority, entitled to prescribe the format of a credit note or a debit note, could not have incorporated such a prescription as a part of the rule itself is obviously not a contention pressed forth by the petitioner. In such circums ..... X X X X Extracts X X X X X X X X Extracts X X X X
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