THE STATE OF KARNATAKA Vs. CEETA INDUSTRIES LIMITED

JUDGEMENT

(1.) Mr.Vikram A.Huilgol, HCGP for Petitioner-Revenue Mr.K.Mallaha Rao, Adv. for Respondent-Assessee The State has filed this Revision Petition raising the following substantial questions of law arising from the order of the learned Karnataka Appellate Tribunal dated 31.01.2017 in STA Nos.486-490/2016:

(2.) The controversy in the present case is with regard to the trade discount being treated as not part of sale price in the hands of selling dealer which controversy is settled in the decision of the Hon'ble Supreme Court in the case of M/s. Southern Motors vs. State of Karnataka and others' in Civil Appeal No.10955-10971/2016 decided on 18.01.2017. The relevant portion from the judgment is quoted below for ready reference:

(3.) The learned Tribunal in Para 19 of the impugned order however has held that the reversal of input tax credit on rebate / discount as done by the Assessing Authority and the order of the First Appellate Authority is not in accordance with law. The said view of the Tribunal is clearly in conflict with the reasoning of the Hon'ble Supreme Court. However, it would require an investigation into the facts as to whether the Date of Judgment 10-08-2018 STRP No.299/2017 The State of Karnataka Vs. M/s. Ceeta Industries Limited consequential adjustment and reduction in the output tax liability in the hands of selling dealer who has given such trade discount to the purchasing dealer and which is not to be treated as part of sale price, has been done or not and depending upon that, as a consequence, the reversal of input tax credit in the hands of purchasing dealer i.e. respondent - assessee can be made.