IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 07TH DAY OF MARCH, 2019 BEFORE:
THE HON’BLE MRS. JUSTICE S.SUJATHA WRIT PETITION No.57879/2018 (T – RES) BETWEEN:
M/s. DHRUVA ENTERPRISES No.11-1128/996, G.M.H.P. SCHOOL ROAD PUTTUR-574201 [D.K.] REP. BY ITS PARTNER SRI K.RAGHUVEEN PRABHU AGED 59 YEARS. ... PETITIONER [BY SRI K.M.SHIVAYOGISWAMY, ADV.] AND:
1. STATE OF KARNATAKA REP. BY ITS SECRETARY DEPARTMENT OF FINANCE VIDHANA SOUDHA BENGALURU-560001.
2. THE JOINT COMMISSIONER OF COMMERCIAL TAXES [APPEALS] MANGALORE DIVISION MANGALURU-575001.
3. THE COMMERCIAL TAX OFFICER [AUDIT]-1, BANTWAL-574219 [DK]. …RESPONDENTS [BY SRI T.K.VEDAMURTHY, AGA.] THIS WRIT PETITION IS FILED UNDER ARTICLES 226 & 227 OF THE CONSTITUTION OF INDIA, PRAYING TO DECLARE AND HOLD THAT HAS NOT JURISDICTION OR ANY AUTHORITY OF LAW TO INVOKE SECTION 19 OF THE KVAT ACT AS REGARDS SALE OF IRON ORE AT A LESSER PRICE THAN THE PURCHASE VALUE, PRIOR TO AMENDMENT TO SECTION 11[9][d] OF KVAT ACT, AS THE AMENDMENT CAME INTO FORCE WITH EFFECT FROM 01.04.2015 AND ETC., THIS PETITION COMING ON FOR PRELIMINARY HEARING, THIS DAY, THE COURT MADE THE FOLLOWING:-
O R D E R The petitioner has challenged the endorsements issued by the respondent dated 24.09.2018 and 16.01.2019 at Annexures-G and J respectively whereby the rectification application filed by the petitioner has been rejected.
2. The petitioner is claiming to be a partnership concern engaged in trading of Iron Ore Fines and coffee beans being registered as a dealer under the provisions of the Karnataka Value Added Tax Act, 2003 ['Act' for short]. It appears that during the tax periods 2008-09 onwards, the petitioners has purchased Iron Ore Fines from the parties at the rate ranging from Rs.1425/- to Rs.2650/- per metric ton and filed the return of turnover in VAT-100 and paid the applicable taxes thereon and also claimed input tax credit on the purchases made thereto. The respondent No.3 concluded the re-assessment proceedings under Section 39[1] of the Act after issuing notice to the petitioner and restricted the input tax credit availed by the petitioner on the alleged ground that the input tax availed requires to be worked out as provided under Section 19[1] of the Act. Against which the petitioner filed an appeal pursuant to the directions issued by this Court in W.P.No.57213/2016 [D.D. 24.03.2017] which came to be dismissed though observing that Section 11[9][d] of the Act would come into effect from 01.04.2015 where it is specified that any dealer has sold goods at lesser price than the price of such goods purchased by him the amount of input tax credit shall be restricted to the amount of output tax of such goods.
3. However, the petitioner’s case being of the year 2014-15, on further representation made before the authorities, the same has been rejected in as much as the input tax credit claimed under Section 19[1] of the Act, observing that the appellate Authority has dismissed the appeal filed by the assessee/petitioner. Being aggrieved by the same, the petitioner is before this Court.
4. Learned counsel Sri.K.M.Shivayogiswamy appearing for the petitioner reiterating the grounds urged in the writ petition submitted that interpretation given by the assessing officer passed by the first appellate authority is ex-facie erroneous and requires interference by this Court.
5. Learned counsel Sri.T.K.Vedamurthy, appearing for the Revenue supports the impugned order and would submit that without availing the alternative remedy available under the Act, the petitioner has rushed to this Court and hence the writ petition deserves to be dismissed.
6. Having heard the learned counsel for the respective parties and perusing the material on record, this court is of the considered view that the grievance of the petitioner can be very well considered by the Tribunal exercising the appellate jurisdiction under the provisions of the Act; ordinarily, the writ petition filed by the petitioner circumventing the appellate remedy is not maintainable. However, considering the peculiar facts of the case relating to the interpretation of the order of the first appellate authority by the Assessing Officer, the same requires a clarification by the first appellate authority.
Hence, it would be appropriate for the assessee/petitioner to move before the first appellate authority seeking clarification of the order dated 23.03.2018. If such application is moved by the assessee/petitioner within a period of two weeks from today, the first appellate authority shall consider the same in accordance with law and shall clarify the order dated 23.03.2018 in an expedite manner.
With the aforesaid observations and directions, writ petition stands dismissed.
In view of the disposal of the writ petition, I.A.No.1/2019 is dismissed.
Sd/- JUDGE NC.