SIDDHARTH ENGINEERING INDUSTRIES Vs. STATE OF ANDHRA PRADESH

JUDGEMENT

(1.) THIS is an appeal filed against the proceedings of the Appellate Deputy Commissioner (CT)., Hyderabad Rural Division, Hyderabad in Appeal No. S/52/2008 -09, dated 28 -02 -2009. The appellant M/s. Siddharth Engineering Industries, IDA Nacharam, Hyderabad registered under AP VAT Act, 2005 and on the rolls of Commercial Tax Officer, Nacharam Circle (also called as 'assessing authority'). The Commercial Tax Officer conducted VAT Audit of the appellant and on verification of the books of accounts for the year 2006 -07, of the appellant with reference to purchase and sales details observed that a)the dealer claimed over declaration of Input Tax Credit for the year 2006 -07 for an amount of Rs. 62,891/ - b) purchases from unregistered dealers of the supplier and claimed Input Tax Credit of Rs. 3,97,308/ - on such purchases effected c) purchased from the sellers who filed NIL returns and the assessee claimed Input Tax Credit to an extent of Rs. 7,91,242/ - and d) further observed the dealer claimed Input Tax Credit of Rs. 52,211/ - from the dealers who closed their business e) Claimed Input tax credit of Rs. 11,291/ - from those dealers who have not filed returns f) claimed Input tax credit of Rs. 1,11,233/ - on the purchases of stationery item, Xerox toner, diesel engine and four wheeler and on the whole, the assessing authority found irregularities on the claim of Input Tax Credit to an extent of Rs. 14,26,176/ - and accordingly he proposed to disallow it and issued a show cause notice. The assessee filed objections, considering the reply, the assessing authority disallowed Input Tax Credit to an extent of Rs. 9,85,656/ - and passed the order dated 20 -12 -2008. Aggrieved by this order, the assessee preferred an appeal before the Appellate Deputy Commissioner (CT)., who in the order dated 28 -02 -2009 dismissed the appeal. Aggrieved by this order, the appellant filled the appeal before this Tribunal contending in the grounds of appeal as follows:

(2.) AT the time of hearing, the learned Counsel for the appellant reiterated the grounds of appeal and strongly objected the disallowance of Input Tax Credit claimed by the appellant and further contended that mere selling dealer has not paid taxes and closed their firm will not entitle the lower authority to disallow the Input Tax Credit claimed by the appellant. The burden of proof lies on the revenue to prove that selling dealers have not filed returns and paid taxes due thereon. As per the law laid under AP VAT Act & Rules, 2005, the appellant produced tax invoices and also other details before the Appellate Deputy Commissioner (CT)., who rejected with an observation that tax invoices were improper, way bills were not filed to establish the movement of goods,. Further the Authorized Representative relied the decision the AP High Court in Harsh Jewellers reported in : 54 APSTJ 133. All the documents pertaining to transactions and payment were filed before the Appellate Deputy Commissioner (CT)., and without appreciating the evidence filed, simply rejected without any valid reasons and finally pleaded the Tribunal to remit the matter back to the assessing authority for fresh disposal on the material produced before the Appellate Deputy Commissioner (CT)., and pass orders in the matter.

(3.) HEARD both sides of the arguments.