2016 (4) TMI 921

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....(hereinafter referred to as 'the KVAT Act', for brevity). The petitioner is engaged in the business of leasing of motor vehicles to various corporate entities as well as providing vehicle finance to individuals. In the case of the activity of leasing of motor vehicles, the vehicles are purchased from local registered dealers within the State of Karnataka and thereafter, the petitioner leases the vehicles on commercial terms and conditions under lease agreements. In respect of the tax periods 2008-09 to 2011-12, the petitioner claims to be entitled for input tax rebate on the purchases effected from the local registered dealers, who had issued valid tax invoices for the sales made and the tax paid at the time of purchase of the veh....

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....etitioner were motor vehicles which is found under the entry No.1 of the Schedule V to the KVAT Act for the purpose of input tax restriction as per the provisions of Section 11(a)(2) of the KVAT Act, which provision reads as under: "11. Input tax restrictions : (a) Input tax shall not be deducted in calculating the net tax payable, in respect of.- (1) xxxxxxx (2) tax paid on goods as specified in the Fifth Schedule subject to such conditions as may be specified, purchased and put to use for purposes other than for.- (i) resale; or (ii) manufacture or any other purpose of other goods for sale." 3. As per the above provision, in respect of goods specified under Schedule V to the KVAT Act, the input tax may not be claimed until su....

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....er. Since the petitioner was entitled for adjustment of excess tax paid in view of the said notice issued, the petitioner made adjustments of the excess taxes paid for the aforesaid tax periods against the output tax payable from the month of August 2014 in the monthly returns submitted in Form VAT 100 under the KVAT Act before the third respondent. Subsequently, the second respondent had observed that the allowance of input tax in the re-assessment orders as per the actual input tax claimed by the petitioner as per the returns filed in Form VAT 100 has resulted in loss of revenue and the re- assessment orders was opined to be erroneous insofar as the same as prejudicial to the interest of the public revenue in the light of the judgment of ....