Purchase tax and input tax credit on sugarcane were governed by settled precedent, leaving the Revenue's position undisturbed.

Purchase tax on sugarcane under the Punjab Value Added Tax Act, 2005 was treated as lawfully leviable, and input tax credit was denied on that tax because the issue had already been decided against the assessee in a binding earlier HC ruling. The Court saw no reason to depart from settled precedent and applied that view to the present dispute. The argument based on Article 266 of the Constitution did not change the result, as the manner of collection and utilisation of the tax could not override the earlier binding decision. The issue was decided in favour of the Revenue.

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Issues: Whether purchase tax on sugarcane under the Punjab Value Added Tax Act, 2005 was lawfully leviable and whether input tax credit could be denied on such purchase tax.

Analysis: The appeal involved the same question that had already been decided against the assessee in an earlier binding decision of the same Court. The Court found no reason to depart from that view and held that the levy of purchase tax and the consequent denial of input tax credit were governed by the settled precedent. The submission based on Article 266 of the Constitution of India did not alter the position, as the collection and utilisation of the tax could not displace the earlier binding ruling.

Conclusion: The issue was decided against the assessee and in favour of the Revenue.

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