UNITED BREWERIES LIMITED Vs. STATE OF BIHAR

JUDGEMENT

(1.) The following substantial questions of law arise in the above case :-

(2.) The assessee is engaged in the manufacture of beer brands, which are imported and sold within the State of Bihar. The appellant while importing beer from breweries situated outside the State of Bihar through stock transfer deposit Entry Tax on the import value of beer. The Entry Tax paid at the rate of 16% is set off on the tax payable on beer sold within the State, which in the subject year was at the rate of 50%. In the financial year 2008-09, the appellant deposited Entry Tax of Rs.2,66,86,475.00. It is alleged that beer valued at Rs.12,32,966.00 was lost in transit and while stored in the godown, due to breakage. It is the contention of the appellant that the stock so destroyed was never sold, used or consumed within the State and hence, the Entry Tax paid will have to be refunded.

(3.) The assessment passed based on the entire Entry Tax being set off against the VAT liability resulted in an audit objection. Reassessment was carried out and the tax component with respect to the value of destroyed stock was denied set off in the final liability.