V V SHAMEER Vs. STATE OF KERALA

JUDGEMENT

(1.) The petitioner/assessee aggrieved by the order of the Kerala Value Added Tax Appellate Tribunal, refusing input tax credit to the extent the assessee received incentives from its manufacturer, is before us raising the following questions of law as framed in the memorandum of revision:

(2.) The petitioner/assessee is a dealer in electrical items who had claimed input tax credit for the tax paid on purchase of goods from its manufacturer. The assessee had not disclosed any incentive having been given to the assessee by the manufacturer. However, the audited statement revealed an incentive of Rs. 11,18,322/-. On the input tax credit, the Assessing Officer (AO) found that there should be a reduction to that extent, especially since there was no disclosure of the incentive received in the returns filed. In fact, the assessee had an opportunity to revise the returns under Section 42(2) on a discrepancy being noticed in the audited statement, which was also not availed of.

(3.) On notice being issued for declining the input tax credit to the extent of the incentive received by the assessee, the assessee produced certain credit notes before the AO and also a declaration as seen from Annexure-H. Before the AO, it was contended that the incentive received was with respect to the schemes floated by the manufacturer for achieving sales targets and also for meeting the distribution expenses. Credit notes were filed, but not in Form No.9 as prescribed under the Kerala Value Added Tax Act, 2003 ('Act', for short). The AO found that the details as available in form No.9 is not seen in the credit note filed by the assessee before the AO. The AO also did not refer to any declaration having been filed by the assessee of the manufacturer.