2009 (7) TMI 1167

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....e by C.N. RAMACHANDRAN NAIR J.-The issue stands referred to us by a Division Bench which doubted the correctness of the judgment of another Division Bench in T.R.C. No. 226 of 2001 dated August 20, 2001, wherein this court held that dealers who have collected sales tax are entitled to retain it as an incentive. However, the Bench which referred the matter to us felt that the judgment was issued....

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.... agreed price from Civil Supplies Department and remitted the same, the petitioner which was enjoying sales tax exemption, included the sales tax along with the price and collected a consolidated amount and claimed exemption. The Intelligence Wing of the Sales Tax Department conducted verification of tax payments by those engaged in supply of wheat products for distribution under the PDS scheme an....

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....ribunal that the petitioner has filed these revisions. Counsel for the petitioner relied on annexure C issued by the Government and relying on the Division Bench judgment abovereferred to contended that the petitioner is entitled to retain the collected tax as an incentive. According to the counsel, the petitioner is entitled to sales tax exemption by virtue of certificate of exemption issued u....

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....he tax collection. We do not think it makes any difference whether the tax was collected separately or the same was included and collected along with the price. When tax is collected by a dealer who is not liable to pay the same, the tax so collected is liable for forfeiture under section 46A(1) of the Act. In fact, when the same is brought to the notice of the Civil Supplies Department, they dire....