Court :
Supreme Court of India
Brief :
The Hon'ble Supreme Court in the case of The Additional Commissioner of Commercial Taxes v. M/s Shankara Infrastructure Materials Ltd. [arising out of SLP (Civil) No. 5504 of 2022 dated October 14, 2024] granted leave and allowed appeal, wherein M/s. Shankara Infrastructure Materials Ltd. ("the Respondent")was duly served notice, however, no appearance was made before the officer.
Citation :
Arising out of SLP (Civil) No. 5504 of 2022 dated October 14, 2024
The Hon'ble Supreme Court in the case of The Additional Commissioner of Commercial Taxes v. M/s Shankara Infrastructure Materials Ltd. [arising out of SLP (Civil) No. 5504 of 2022 dated October 14, 2024] granted leave and allowed appeal, wherein M/s. Shankara Infrastructure Materials Ltd. ("the Respondent")was duly served notice, however, no appearance was made before the officer.
Further, on July 19, 2024, the case was last listed. The Additional Commissioner of Commercial Taxes ["the Petitioner"]contended that the case the case in hand covered by the judgment of State of Karnataka v. Ecom Gill Coffee Trading Private Limited [Civil Appeal No. 230 of 2023] and alleged that the case is of bogus claim without any actual transactions. Hence, the Assessee cannot claim the Input Tax Credit ("ITC"). Transactions with a non-existing or bogus entities do not satisfy the criterion for claiming ITC.
The Court relied on the case of Ecom Gill Coffee Trading Private Limited (supra) and disposed of the case.
Our Comments:
Section 70 of the Karnataka Value Added Tax Act, 2003 ("the KVAT Act") in sub section (1) states that for the purposes of payment or assessment of tax or any claim to ITC under the KVAT Act, the burden of proving that any transaction of a dealer is not liable to tax, or any claim to deduction of input tax is correct, shall lie on such dealer. Further, Sub Section (2) states that where a dealer knowingly issues or produces a false tax invoice, credit or debit note, declaration, certificate or other document with a view to support or make any claim that a transaction of sale or purchase effected by him or any other dealer, is not liable to be taxed, or liable to tax at a lower rate, or that a deduction of input tax is available, the prescribed authority shall, on detecting such issue or production, direct the dealer issuing or producing such document to pay as penalty:
Lastly, Sub Section (3) of the KVAT Act states that before issuing any direction for the payment of the penalty under this Section, the prescribed authority shall give to the dealer the opportunity of showing cause in writing against the imposition of such penalty.
In the case of Ecom Gill Coffee Trading Private Limited (supra), the Hon'ble Supreme Court held as under:
OFFICIAL JUDGMENT COPY HAS BEEN ATTACHED