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TMI Blog2023 (8) TMI 1038X X X X Extracts X X X X X X X X Extracts X X X X ..... t of collected tax to the State; for which the statute provides ample scope, is the question raised. 2. The question unfortunately is raised against an assessment order on which there is a statutory appeal provided. The assessment order is dated 24/25.05.2022 and as per Section 107 of the Bihar Goods and Services Tax Act, 2017 (for brevity "BGST Act") an appeal has to be filed within three months and with sufficient cause shown for the delay occasioned, within a further period of one month. It is trite that an appeal would not lie after the specific period provided for delay condonation. Hence, an appeal ought to have been filed either as on 24.08.2022 or with a delay condonation application within 24.09.2022. Admittedly, no appeal has been filed and the petitioner has filed the above writ petition long after the period of appeal has expired. Be that as it may, we proceed to consider the issue raised, since it falls for interpretation of the provision enabling Input Tax Credit under the BGST Act. 3. Smt. Archana Sinha, learned counsel appearing for the petitioner points out that the purchases were made after making payments through bank accounts. Invoices were issued by the selli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5. We will first look at the decisions placed before us by the learned counsel for the petitioner. Sri Vinayaga Agencies was followed in M/s D.Y. Beathel Enterprises; the former under the VAT Act and the latter under the GST Act. Under the VAT Act in the State of Tamil Nadu Section 19 provided that, Input Tax Credit of the amount of tax paid or payable under the Act by the registered dealer to the seller; on his purchase of taxable goods, specified in the First Schedule, shall be available. The proviso required that the registered dealer who claims Input Tax Credit should establish that the tax due on such purchase has been paid by him in the manner prescribed. Sub-section (16) of Section 19 also provided that the Input Tax Credit availed by a registered dealer would only be provisional and the assessing authority is empowered to reverse the same, if it appears that the claim was incorrect, incomplete or otherwise not in order. The learned Single Judge found that the power of revocation does not extend to contingencies of non-payment of tax by the selling dealer. In the case before Court, the petitioner dealer had admittedly paid the tax to the selling dealer and on raising the cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cting as an agent or otherwise, before or during movement of goods, either by way of transfer of documents of title to goods or otherwise; (c) subject to the provisions of section 41, the tax charged in respect of such supply has been actually paid to the Government, either in cash or through utilisation of input tax credit admissible in respect of the said supply; and (d) he has furnished the return under section 39" 8. Sub-section (1) of Section 16 deals with the eligibility of a registered person to avail of Input Tax Credit on any supply of goods, or services or both which are used or intended to be used in the course or furtherance of his business and the said amount is to be credited to the electronic credit ledger of such person. The conditions for enabling such benefit, are available in Clauses (a) (b) and (c) which are in seriatim; the existence of a tax invoice or debit note issued by the supplier, proof of receipt of goods or services or both and the tax charged in respect of such supply having been actually paid to the Government, either in cash or through utilization of Input Tax Credit admissible in respect of the said supply. The said conditions are to be sat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ished especially looking at Section 70 of the KVAT Act and also the petitioner herein having produced not only the invoices but also the account details and the documents evidencing transportation of goods. However, we have to notice that this does not absolve the assessee from the rigor provided under sub-clause (c) of Section 16(2) of the BGST Act, which requires the credit of tax, collected from the purchasing dealer; either in cash or through utilization of admissible Input Tax Credit, being available in the context of the supplier having actually paid tax to the Government. This in effect is a burden of proof cast on the purchasing dealer who claims Input Tax Credit, which is a right created under statute; sustained only under the specific terms of the statute. 11. It is true that Input Tax Credit is a concept introduced in the tax regime, all over the country for the purpose of avoiding the cascading effect of taxes. The benefit of such credit being availed by a purchasing dealer who sells or manufactures goods, using raw materials on which tax has been paid is a benefit or concession conferred under the statute as has been held in ALD. Automobile Private Limited. Necessaril ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent contract without the junction of the Government. The statute provides for a levy of tax on goods and services or both, supplied by one to the other which can be collected but the dealer who collects it has also the obligation to pay it up to the State. The statutory levy and the further benefit of Input Tax Credit conferred on the purchasing dealer depends not only upon the collection by the seller but also the due payment by the seller to the Government. When the supplier fails to comply with the statutory requirement, the purchasing dealer cannot, without credit in his account claim Input Tax Credit and the remedy available to the purchasing dealer is only to proceed for recovery against the seller. Even if such recovery from the supplier is effected by the purchasing dealer; the State would be able to recover the tax amount collected and not paid to the exchequer, from the selling dealer since the rigor of the provisions for recovery on failure to pay up, after collecting tax, enables the Government so to do. 15. It is clear that the literal nomenclature and the statutory language, mandates that there should be credit available in the credit ledger of the purchaser to claim ..... X X X X Extracts X X X X X X X X Extracts X X X X
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