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TMI Blog2019 (9) TMI 575X X X X Extracts X X X X X X X X Extracts X X X X ..... for grant of benefit of set off, it was clearly stipulated by way of condition no. 3 that it was permissible to the manufacture (of notified goods) to claim such deduction, by way of an option to the payment of full tax on sale of such goods. It was not compulsary for that manufacturer to necessarily avail set off. The reasoning given by the Tribunal apart, it does not appear possible to contemplate a situation where a claim of set off may have been raised by the assessee after it had failed to make a deduction of tax payable on the sale of tubular poles and it had charged full tax @ 4% on sale of tubular poles. Thus, notwithstanding full compliance made by the assessee, in payment of tax on purchase of raw material and charge of tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notification no. 2339 dated 22.10.1996, read with notification no. 1223 dated 22.5.1998. In the course of the assessment proceedings, the assessee claimed set off of tax paid on purchase of raw materials used in the manufacture of tubular poles. The assessing officer rejected the claim on the reasoning that the assessee had not raised any such claim in its return and, therefore, it was not permissible to grant the same at the stage of assessment. The first appeal filed by the assessee was allowed by the Joint Commissioner (Appeal), by his order dated 19.2.2003, on the reasoning that under the aforesaid notifications, there was no restraint place in law that such set off may be claimed at the stage of filing of return and not later. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consumed in the manufacture of tubular poles that is notified goods being Iron Steel as per notification No. 1223 dated 22.05.1998, the assessing was right in denying the set off under Section 4-BB of the Act since it was not claimed in the return but was claimed at the time of the assessment. 5. Learned Senior Counsel would submit, the reasoning of the assessing authority was completely erroneous, inasmuch as, there is no stipulation either under the Act, or under the relevant notifications, whereby the claim for set off must necessarily be made at the stage of filing the return. On the other hand, the first appellate authority had correctly allowed the same as the assessee had not flouted, either the provisions of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. Having done that, the assessee clearly opted out of the set off scheme, which in any case, did not have mandatory force. Alternatively, it has been submitted that the dispute being canvassed by the assessee is purely academic, inasmuch as, there is no provision for the refund of the tax paid on purchase of raw materials. Having charged full tax on the sale of tubular poles, the assessee cannot claim any refund or adjustment of that amount against any other liability that may be standing against it. 9. Having heard learned counsel for the parties and having perused the record, in the first place, though it is true that the claim for set off may not have been rejected only because the same had not been raised in the return ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or sale of raw material or packing material, from which the goods sold in the course of inter State trade or commerce were manufactured or packed: Provided that the amount of tax to be deducted under clause (a) or clause (b) shall not exceed the amount of tax payable separately under this Act or the Central Sales Tax Act, 1956. 11. Thus, in the first place, the set off is available with respect to the tax paid on purchase of raw materials used in the manufacture of notified goods. Second, such set off is to be availed by making deduction of that amount from the tax payable on the sale of notified goods. The tax on sale of tubular poles would have become payable at the time of sale of those goods by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e does not exist in the present case. 13. Therefore, the reasoning given by the Tribunal apart, it does not appear possible to contemplate a situation where a claim of set off may have been raised by the assessee after it had failed to make a deduction of tax payable on the sale of tubular poles and it had charged full tax @ 4% on sale of tubular poles. 14. In view of the above, the question of law no. 1 is answered thus - notwithstanding full compliance made by the assessee, in payment of tax on purchase of raw material and charge of tax on sale of tubular pipes, it lost the right to claim the set off under Section 4-BB of the Act upon opting to charge full tax on sale of tubular pipes, instead of deductin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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