Strict compliance with shipment-proof conditions governs concessional VAT rate for specified sales under Kerala tax rules.

The concessional tax rate under the proviso to Section 6(1) of the Kerala Value Added Tax Act was held to depend on strict compliance with Rule 12C. A dealer seeking the concession must obtain Form No. 42 duly signed and sealed by the buyer and also produce the shipping bill or similar document attested by the port authorities, with copies filed along with the return. The Court held that these documentary requirements are mandatory and cannot be diluted by purposive interpretation. Form No. 42 alone was treated as insufficient, and the earlier contrary view was not accepted.

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Issues: Whether the dealer was entitled to concessional rate of tax under the proviso to Section 6(1) of the Kerala Value Added Tax Act, 2003 without producing the shipping bill or similar document duly attested by the port authorities as required by Rule 12C of the Kerala Value Added Tax Rules, 2005, and whether the earlier judgment holding otherwise was liable to be set aside.

Analysis: The concessional rate under the proviso to Section 6(1) is not available merely because the sale is made to the specified buyers. The proviso expressly makes the concession subject to conditions prescribed by the Rules. Rule 12C requires the dealer to obtain a declaration in Form No.42, duly signed and sealed by the buyer, along with a copy of the shipping bill or similar document duly attested by the port authorities, and to file copies with the return. The requirement is clear and unambiguous, and the Court held that there was no basis to dilute it by resort to purposive interpretation. The Court further held that a dealer who opts to make a sale at concessional rate cannot avoid the statutory burden of producing the prescribed proof of shipment, and the earlier view treating Form No.42 alone as sufficient was not accepted.

Conclusion: The requirement of producing shipping bills or similar attested documents under Rule 12C is mandatory, and the dealer cannot claim the concessional rate without complying with the prescribed conditions. The judgment under appeal was set aside and the writ appeals were allowed.

Final Conclusion: The statutory conditions for concessional taxation of sales to the specified Lakshadweep entities were upheld as mandatory, and the Revenue succeeded in the appeals, though limited liberty was granted for production of shipment evidence and reconsideration in accordance with law.

Ratio Decidendi: Where a taxing proviso grants a concession subject to prescribed conditions, those conditions must be strictly complied with and cannot be relaxed by judicial construction when the text is clear.

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