VISTEON AUTOMOTIVE SYSTEMS PVT. LTD. Vs. DEPUTY COMMISSIONER

JUDGEMENT

(1.) Heard learned counsel for the petitioner and the respondent Deputy Commissioner of Commercial Taxes, Large Tax Payers Unit.

(2.) Short point that arises for consideration in the present writ petition is whether the respondent was justified in directing the petitioner to reverse the input tax credit availed on capital goods in excess of 4% vide the impugned order?

(3.) The petitioner had purchased "capital goods" as defined in Section 2(11) of the TNVAT Act, 2006 for manufacturing purpose and availed input tax credit in terms of Section 19(3) of the said Act. As per Entry 25, Part B to the I schedule of the said Act, the "capital goods" are liable to VAT at 4%. However, the dealer who sold the "capital goods" to the petitioner charged VAT at 12.5% and passed on the incidence of such tax to the petitioner. The petitioner therefore availed the tax paid and reflected in the invoice at 12.5%.