Reversal of Input Tax Credit - In GST / VAT era, emergence of by-product which is exempt during manufacturing process is not relevant, what is relevant is sale of goods.

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..... 7 (9) TMI 1308 - SUPREME COURT OF INDIA In an important decision though related to Karnataka Value Added Tax (VAT) but equally important in the GST era for reversal of Input Tax Credit on exempted by-products. While interpreting the provisions of Section 17 of KVAT, hon'ble Supreme Court in the case of 2017 (9) TMI 1308 - SUPREME COURT OF INDIA, held that: - Fourthly, the entire scheme of t .....

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..... duct is sold and the VAT paid, component of raw material would be included again. Keeping in view this objective, the Legislature has intended to give tax credit to some extent. - However, how much tax credit is to be given and under what circumstances, is the domain of the Legislature and the courts are not to tinker with the same. - Judgment in Godrej & Boyce Mfg. Co. Pvt. Ltd. & Ors. v. Commi .....

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..... able consideration. We may point out there that the assessing authorities recorded a clear finding, which was accepted by the Tribunal as well, that records and statement of accounts of the respondent assessee clearly stipulates that after solvent extraction is completed, 88% of de-oiled cake remains and only 12% remains is the oil which is further refined in the refinery. This clearly shows that .....

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