TaxTMI 
TaxTMI 
2016 (8) TMI 1336
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....itioner had been regularly complying with the requirement of the Act of 2002; quarterly returns are being filed as and when required under the Statute. It is said that for the period 1.4.2012 to 31.3.2013, quarterly reports were submitted by the petitioner within time and set off of „input rebate‟ on account of material purchased from MP Power Generating Company by way of e-auction was claimed. For the year in question, in an e-auction conducted by the MP Power Generating Company, petitioner had purchased certain scraps in the form of sale, made of a coal handling plant, conveyor belt, track hopper, coal banker and coal crusher plant. The purchase was made in accordance to the terms and conditions stipulated in Annexure P/2, the tender and purchase agreement. It is said that in accordance to the terms and conditions of the Agreement, the purchase price i.e... the value of goods sold with taxes were to be deposited in installments. After payment of installments, the plant was dismantled. Annexure P/3 is a copy of the cash memo showing the sale wherein the sale price and the tax component have been separately indicated. On the basis of the payment of installments, the pet....
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....actual payments are made in consideration for the sale and not on the date of the invoice. 6- In the present case, according to learned Senior Advocate the overwhelming documents clearly indicate that the sale consideration alongwith tax was paid during the Financial Year; the gate pass and the cash memo of the sale transaction show that the sale consideration and the tax liability thereof was paid during the Financial Year in question i.e....between 1.4.2012 and 31.3.2013, and merely because the final invoice is of a date subsequent to the Financial Year, that cannot be a ground for disallowing the benefit. Learned Senior Advocate submits that without taking note of these material facts, which are relevant, the action taken is unsustainable. 7- Learned Senior Advocate invites our attention to a judgment of the Supreme Court, in the case of Arun Electrics, Bombay Vs. Commissioner of Sales Tax, Maharashtra, (2010) 17 STJ 504 (SC), to canvass a contention that the question as to whether a transaction is liable to tax is required to be determined on the basis of the terms and conditions of the Contract and the actual transaction made and not on the basis of a mere invoice issued....
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....to during the Financial Year in question. According to the terms and conditions of the agreement, the payment of consideration for the scrap has to be made in four installments and the method of payment of installments; action required to be taken for lifting of the material etc are contemplated in Clause 6.1 and 6.2 of the Agreement, in question. On deposit of the first installment, the first segment of the plant is permitted to be dismantled, but on payment of this installment lifting of the material is not permitted. On deposit of the second installment, dismantling of the second segment of the plant can be made and at that point of time, the dismantled material of the first segment can be lifted. Similarly on payment of the third installment, dismantling of the third segment is permissible and consequential lifting of the first and second segment can be made; and, when the fourth and balance installment is paid, the entire dismantling of the plant is permitted and the entire dismantled material can be lifted. Clause 6.3 further indicates that when installments are paid, they should include the installment for the material to be lifted alongwith applicable tax, duties and penalt....
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.... the assessee herein and the first installment is shown to have been paid as per the Agreement on 6.9.2012. Thereafter, the dismantling/disposal of the scrap is indicated; the amount of the first installment is also indicated as Rs. 7,75,25,001=00; and, the VAT @ 13% is shown to have been paid as Rs. 1,00,78,250=00. The total amount of payment made under this invoice dated 25.4.2013 is Rs. 8,84,79,284=00, which includes the VAT paid. Even though this invoice is issued on 25.4.2013, the entire installment is shown to have been paid on 6.9.2012, and based on the payment made, the entire material was removed in Truck No.MP20-HB-2052, on 17.12.2012, as is evident from Annexure P/4. The gate pass and the delivery memo - Annexure P/4 clearly show that the delivery was made in pursuance to the first installment paid on 6.9.2012; and, the particulars of the receipt issued for payment of this installment is the one indicated in the invoice - Annexure P/3. A complete reading of Annexures P/3 and P/4 indicates the following facts:- (a) This transaction shows action taken in pursuance to the agreement for sale; (b) Payment of first installment on 26.9.2012; delivery of the material, issu....
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.... question, as detailed hereinabove i.e.... in the memo dated 25.4.2013 - Annexure P/3, the transaction is shown to have been made in the following manner:- buyer‟s order - 6.9.2012; and, first installment paid on 6.9.2012. Similarly, in the second memo dated 3.6.2013, the buyer‟s order is shown as 6.9.2012; and, the second installment paid on 15.12.2012, i.e... well within the Financial Year. The actual payment of the installment and the tax component is in the Financial Year and if the actual payment of duty or tax is in the Financial Year, merely because the invoice is issued on a subsequent date, may be after the Financial Year, the question would be as to whether the benefit can be denied to the petitioner. 17- In the case of Arun Electrics (supra) and while considering somewhat similar circumstances, the Hon‟ble Supreme Court holds that "the invoice merely sets out the amount chargeable to the customer for „supplying and affixing‟ certain electric fittings and equipment, and would not throw light on the nature of the contract". It has been held by the Supreme Court in the aforesaid case that the question as to whether in respect of a transactio....
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....a set off or input rebate. 20- The West Bengal Taxation Tribunal also considered somewhat similar situation and allowed „input rebate credit‟ based on verification of the documents. Finding that it was a bonafide transaction made, we find no reason to take a different view in this case. Merely because the two invoices are issued by the Power Generating Company on 25.4.2013 and 3.6.2013 respectively, it would not mean that the entire transaction, including payment of duty/tax, took place after the Financial Year, when the overwhelming documents available on record, particularly the delivery memo, gate pass etc shows the transaction to have taken place during the Financial Year and when the tax was also paid during the Financial Year, the act of the Assessing Officer in denying the benefit of „input rebate‟ in our considered view cannot be accepted or approved by us. 21- That being the factual and legal position, we are of the considered view that in disallowing the claim, the learned Assessing Officer has committed grave error. 22- Having so held, we are also required to consider the question of the preliminary objection raised by Shri Samdarshi Tiwa....