STATE OF KARNATAKA REP Vs. HEATCARB ENTERPRISES

JUDGEMENT

(1.) STATE is before us aggrieved by the order of the Tribunal dated 9. 10. 2003 passed in STA No. 390 and 391/2002 in the case on hand. The following question of law is raised: whether the respondent could utilise the benefits of Form-37 declarations when not engaged in any manufacturing activity or sale of goods.

(2.) THE respondent is a registered dealer engaged in rendering heat treatment process to the materials brought by his customers. The respondent is said to have purchased machinery parts against Form-37 declaration and availed reduced rate of tax at 4% in terms of the Notification issued Under Section 8a of the Act. The assessing authority after notice came to a conclusion that the respondent has mis-used the facility given under the notification. He imposed penalty. The same was challenged by way of Writ Petition. Thereafter Writ Petition was withdrawn with liberty to file an appeal. Appeal was filed by the assessee. The Tribunal has chosen to allow the appeal and the Tribunal has set aside the penalty imposed Under Section 5a (2) (v) of the KST act. The State, aggrieved by this order is before us by raising the above referred question of law.

(3.) HEARD Smt. Sujatha, learned Government Advocate and Sri. Narayan, learned Counsel appearing for the respondent and perused the material placed on record.