Karnataka High Court
M/S Rds Project Limited vs Additional Commissioner Commercial ... on 3 February, 2025
Author: Krishna S Dixit
Bench: Krishna S Dixit
-1-
NC: 2025:KHC:4769-DB
STA No. 5 of 2018
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 3RD DAY OF FEBRUARY, 2025
PRESENT
THE HON'BLE MR JUSTICE KRISHNA S DIXIT
AND
THE HON'BLE MR JUSTICE G BASAVARAJA
SALES TAX APPEAL NO. 5 OF 2018
BETWEEN:
M/S RDS PROJECT LIMITED,
WARD NO IV -6, BINAGA, KARWAR, KARNATAKA - 581 307.
(REPRESENTED BY ITS SHASHANK GOYAL, DIRCTOR)
...APPELLANT
(BY SRI. RAVI RAGHAVAN., ADVOCATE AND
SRI. SIDDARTH BAVLE.,ADVOCATE)
AND:
ADDITIONAL COMMISSIONER COMMERCIAL TAXES
(ZONE - II), 7TH FLOOR, VTK - 1,
GANDHINAGAR, BANGALORE - 560 009.
...RESPONDENT
(BY SRI.ADITYA VIKRAM BHAT.,AGA)
THIS STA FILED UNDER SEC. 66(1) OF THE KARNATAKA
Digitally signed VALUE ADDED TAX ACT, 2003 AGAINST THE ORDER DATED
by SHARADA 16.03.2017 PASSED IN CAS NO.252011124 ON THE FILE OF
VANI B
THE JOINT COMMISSIONER OF COMMERCIAL TAXES
Location: HIGH (APPEALS)-1, DHARWAD DIVISION HUBBALLI, PARTLY
COURT OF
KARNATAKA ALLOWING THE APPEALS FILED AGAINST REASSESSMENT
ORDER DATED 27.04.2016 PASSED IN A.O.NO.207759723
(VAT) AND A.O.NO.219759742 (CST) ON THE FILE THE
ASSISTANT COMMISSIONER OF COMMERCIAL TAXES
(AUDIT),GANDHINAGAR BANGALORE, FILED UNDER SECTION
39(1) ALONG WITH PENALTY UNDER SECTION 72(2) AND
INTEREST UNDER SECTION 36 OF THE KVAT ACT 2003 FOR
THE TAX PERIOD OF 2013/14.
THIS STA, COMING ON FOR FINAL HEARING, THIS DAY,
JUDGMENT WAS DELIVERED THEREIN AS UNDER:
NC: 2025:KHC:4769-DB
CORAM: HON'BLE MR JUSTICE KRISHNA S DIXIT
AND
HON'BLE MR JUSTICE G BASAVARAJA
ORAL JUDGEMENT
(PER: HON'BLE MR JUSTICE KRISHNA S DIXIT)
This Appeal by the Assessee calls in question the order
dated 20.03.2018 made by the Respondent - ACCT (Zone-
II). The operative portion of the said order reads as
under:
"The FAA's order dated 16-03-2017 vide
appeal No;AP/VAT-49/2016-17 for the tax periods
falling in the financial year 2013-14 and the PA's
order dated 27-04-2016 for the aforesaid tax
periods are set aside and the matter is remitted to
the PA to re-compute the turnovers and tax liability
in terms of this order."
2. The Assessee has framed the following
substantial questions of law for Admission of the Appeal
and we agree with the same.
"1. Whether the ld. Revisionary Authority was
right in holding that the Appellant is liable to pay
tax on the deemed sales value of the goods
purchased in the course of inter-state trade and
commerce under Section 15(5) (a) r/w Section 4
(1)(c) of the KVAT Act, 2003 and not the purchase
value such goods?
2. Whether the ld. Revisionary Authority was
right in holding the Appellant is liable to include
gross profit and inward freight to the purchase
value of goods purchased inter-state to arrive at
NC: 2025:KHC:4769-DB
the value of such goods' involved in execution of
works contract as referred to in Section 15(5)(a) of
the KVAT Act, 2003?"
3. Whether the ld. Revisionary Authority was
right in restricting the deduction of sub-contractor
turnover under Section 15 (5)(b) of the KVAT
Act,1957 to Rs.5,66,35,357/- and not
Rs.5,92,44,856/- as claimed by the Appellant on
the only ground that the said claim has been
verified by the lower authorities when undisputedly
the Appellant has furnished all documentary
evidences in support of its claim of deduction?"
4.Whether the ld. Revisionary Authority has rightly
invoked jurisdiction under Section 64 of the KVAT
Act without adverting hat the appeal order dated
16.03.2018 is erroneous, besides being prejudicial
to interest of revenue?"
3. After service of notice, learned AGA appearing for
the Respondent resists the Appeal passionately making
submission in justification of the impugned order and the
reasons on which the same is structured.
4. Having heard the learned counsel for the parties
and having perused the Appeal papers, we are inclined to grant
a limited indulgence in the inasmuch as, the substantial
questions of law Nos. 1 & 2 above need not detain the Court for
long inasmuch as, they are no longer res integra in view of
Coordinate Bench decision in STRP No.325/2017 between
STATE OF KARNATAKA vs. M/s. S N BUILDERS &
NC: 2025:KHC:4769-DB
DEVELOPERS, disposed off on 30.09.2021. The said
questions having been answered in favour of the Assessee
and against the Revenue, the matter is remitted to the
portals of Assessing Authority for considering the third
question of law as reproduced above.
In the above circumstances and with the above
observations, the Appeal is disposed off making it clear
that the remand shall be heard & decided in the statutory
limit as prescribed under Section 40 of the Karnataka
Value Added Tax Act, 2003 and after giving an opportunity
of hearing to the Assessee. All contentions of the parties
are kept open.
Costs made easy.
Sd/-
(KRISHNA S DIXIT)
JUDGE
Sd/-
(G BASAVARAJA)
JUDGE
