2015 (4) TMI 610

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.... purchases made from other dealer and on verification of the monthly returns and the departmental website it was noticed that there was variation with references to purchases made. Therefore, the respondent proposed to reverse the Input Tax Credit (ITC). For the notices issued by the respondent for proposing to reverse ITC, detailed replies was given by the petitioner and the respondent has passed the impugned orders confirming the proposal on 02.03.2015. 4. The learned counsel for the petitioner further submitted that the reasons given by the petitioner was not accepted on the ground that the petitioner had made excess input tax credit on the purchase whereas the sellers have reported less sales in their returns and the time sought for is....

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....nd that the petitioner had also given the TIN number of these vendors. When such particulars were available, it was for the Department to take necessary action against the vendors, who had not remitted tax collected by them to the State. Without taking recourse to that, the Department could not deny the claim of the petitioner". 7. The learned counsel for the petitioner also relied on another decision of this Court in the case of Sri Vinayaga Agencies vs. Assistant Commissioner (CT) Vadapalani I Assessment Circle, Chennai and Another reported in [2013] 60 VST 283 (Mad), wherein, it is held as follows:- ".Section 19(1) states that input-tax credit can be claimed by a registered dealer, if he establishes that the tax due on such purchase ha....

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....ould not be rejected nor delayed. The mere fact that the Department had not made an assessment on the dealer's vendor, per se, could not stand in the way of the assessing officer considering the claim of the dealer under Section 19 of the Act. Going by Section 17 which provided that the burden on the purchasing dealer rested to the extent of showing that he was not liable to tax under the Act and read in the context of the fact that the petitioner-dealer had given his sellers TIN number and had also produced the invoices evidencing the purchase of materials paying tax, the Department could not successfully canvass its claim that the petitioner was not entitled to have the refund. It was admitted that the petitioner's vendors were al....

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.... squarely fell under the proviso to section 19(1) of the Act. It was another matter that the selling dealer had not paid the collected tax. The liability had to be fastened on the selling dealer and not on the petitioner-dealer which had shown proof of payment of tax on purchases made. The orders were liable to be set aside. That sub-section (16) of section 19 states that the input-tax credit availed is provisional. It however, does not empower the authority to revoke the input-tax credit availed of on a plea that the selling dealer has nor paid the tax. It only relates to incorrect, incomplete or improper claim of input-tax credit by the dealer". 8. Heard the learned Additional Government Pleader (Taxes) for the respondent. 9. The learne....