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TMI Blog2021 (4) TMI 66X X X X Extracts X X X X X X X X Extracts X X X X ..... AA and the FAA were wrong in disallowing the input tax credit in favour of the assessee for the purchases made from M/s. Priya Traders - Sales Tax Revision Petition is dismissed. - STRP NO.96/2018 - - - Dated:- 25-2-2021 - HON BLE MR. JUSTICE SATISH CHANDRA SHARMA AND HON BLE MR. JUSTICE V. SRISHANANDA PETITIONER (BY SRI VIKRAM HUILGOL, AGA) RESPONDENT (BY SRI T.N. KESHAVA MURTHY, ADVOCATE) ORDER V. SRISHANANDA. J., State has filed this Revision Petition questioning the validity of the order passed in STA No.608/2016 dated 30.10.2017 on the file of Karnataka Appellate Tribunal, Bengaluru [hereinafter referred to as 'the KAT' for short]. 2. Brief facts which are necessary for disposal of this Revision Petition are as under: M/s. Marudhar Granites (hereinafter referred to as assessee for short) is a proprietary concern engaged in trading of polished granite slabs at Bengaluru, duly registered under the Karnataka Value Added Tax Act, 2003 (hereinafter referred to as the Act for short) borne on the file of LVO-040, Bengaluru. Assessee has filed turnover returns in Form No.VAT-100 for the tax period from April 2006 to March 2007. The Assist ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AA. He further emphasized that the scheme of KVAT Act is such that only tax that has been collected by a selling dealer is eligible to avail input tax credit by the purchasing dealer and the Tribunal failed to appreciate the salient features under the scheme of KVAT Act while passing the impugned order. 6. He further contended that the Tribunal grossly erred in considering the provisions of Section 70 of the KVAT Act, which clearly states that the burden of proving any claim as to deduction of input tax shall lie on the dealer. But in the instant case, the assessee failed to prove that M/s. Priya Traders is not a bogus dealer and the purchases effected in the said entity was genuine purchase. 7. He also contended that the Tribunal erred in not properly appreciating the scope and ambit of Section 70 of the Act and thus, sought for allowing the Revision Petition. 8. He further contended that whether the assessee was entitled for input tax rebate was not properly discussed by the Karnataka Appellate Tribunal while passing the impugned order having regard to the materials available on record especially in the form of inspection report and thus sought for allowing the Revisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (2) Where a dealer knowingly issues or produces a false tax invoice, credit or debit note, declaration, certificate or other document with a view to support or make any claim that a transaction of sale or purchase effected by him or any other dealer, is not liable to be taxed, or liable to tax at a lower rate, or that a deduction of input tax is available, the prescribed authority shall, on detecting such issue or production, direct the dealer issuing or producing such document to pay as penalty; (a) in the case of first such detection, three times the tax due in respect of such transaction or claim; and (b) in the case of second or subsequent detection, five times the tax due in respect of such transaction or claim. (3) Before issuing any direction for the payment of the penalty under this Section, the prescribed authority shall give to the dealer the opportunity of showing cause in writing against the imposition of such penalty. 77. Penalties relating to seals, electronic tax registers and to unaccounted stocks.- (1) .. (2) Any persons or dealer who is found to be in possession of unaccounted stocks of any taxable goods under the provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Nos.14 to 16 has held as under by referring to the decided cases by this Court: 14. The counsel for the appellant placed reliance on the judgment of Hon'ble High Court of Karnataka in STRP No.171/2016 STRP No.313 316/2016 in the case of State of Karnataka Vs. Sri Rajesh Jain Partner M/s Salem Steel Trading Com decided on 7-12-2016 and submitted that it is for the Department to proceed against such dealer who fails to deposit the output tax. We have carefully considered the observation made by the Hon'ble High Court, wherein under the circumstances of the respondent submitting genuine Tax Invoices, Ledger extract, part payments made by the respondent through cheques, while dismissing the STRP filed by the state uphold the order of this tribunal and made the following observations, 9. We do not find that the matter can be stretched to that extent as sought to be canvassed. Once the purchaser dealer assessee satisfactorily demonstrate that while purchasing goods, he has paid the amount of VAT to the selling dealer, the matter should end so far as is entitlement to the claim input tax credit. If the selling dealer has not deposited the amount in full or a part the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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