2021 (4) TMI 1037

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....ellate Tribunal (KAT). The petition was admitted by a bench of this court to consider the following substantial questions of law: "(i) Whether on facts and circumstances of the case the Tribunal was right in coming to the conclusion that, tax be levied on the entire sales turnover? (ii) Whether on the facts and circumstances of the case the petitioner is eligible for the tax deduction as per Rule-3 of the KST Rules?" 2. Facts leading to filing of this petition briefly stated are that the petitioner is a partnership firm carrying on the business in the name and style of M/s Balaji Bar and Restaurant. A licence viz., CL-9 was issued to the petitioner under Karnataka Excise Act, 1965. The petitioner is also a registered de....

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....owed by a notice dated 16.01.2016 issued under Section 39(1) of the Act proposing to levy the tax at the rate of 5.5% on the sales made for the period from April 2014 to March 2015, as per the reported turnover, which was claimed to be exempted turnover. An order of assessment was passed on 09.02.2016. The petitioner thereafter, made an application for rectification of the order of assessment on taxing the value addition made in the hands of the petitioner. The Assessing Officer rejected the application for rectification and issued an endorsement on 04.01.2017 and determined the total tax interest and penalty vide order dated 09.02.2016 at Rs. 13,95,272/-. The petitioner being aggrieved by the order of re assessment dated 09.02.2016, pre....

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....not required to pay tax. The petitioner is liable to tax at the rate of 5.5% as per Entry-59 of 3rd Schedule to the Act, which the petitioner collects from the consumers, on the entire amount of sale and therefore, the petitioner cannot contend that he would pay tax to the Government only on value addition as the petitioner has collected tax on whole amount. It is also urged that under Section 10 of the Act, net tax is, output tax minus input tax and there is a value addition where there is an input credit, whereas, in the instant case, the tax is recovered from the customer by the petitioner. 6. We have considered the submissions made by learned counsel for the parties and have perused the record. Before proceeding further, it is apposi....