S.K. SALES AGENCIES Vs. COMMISSIONER OF COMMERCIAL TAXES IN KARNATAKA AND ORS.

JUDGEMENT

(1.) The learned Additional Government Advocate is directed to take notice. The petition is filed for quashing the proposition notice issued under Sec. 39(1) of the Karnataka Value Added Tax Act, 2003 (for short, "the Act") in relation to the assessment period April 2011 to March 2012, dated August 11, 2014 at annexure A and also for a direction to the respondent -authorities to verify the correctness of the tax invoices issued by the selling dealers as referred to in the proposition notice dated August 11, 2014 at annexure A by passing necessary reassessment orders and thereafter, to continue the reassessment proceedings, if the tax invoices issued by the selling dealers are found to be false or bogus, after affording reasonable opportunity to cross -examine the selling dealers.

(2.) The petitioner is said to be a registered dealer under the Act and during August, 2014 the second respondent issued a notice under Sec. 39(1) of the Act for which, the petitioner filed a reply. The second respondent issued an endorsement seeking certain particulars for which, the petitioner is said to have replied along with the documents as sought for by the respondent.

(3.) According to the petitioner, the petitioner is a proprietorship concern and engaged in the sale of Exide UPS and Exide batteries and all types of batteries and battery components and is registered as a dealer and he filed monthly return in VAT -100 for the assessment period 2011 -12 by declaring the correct turnover and paid the taxes thereon. The same has been accepted by the respondent -authorities as per Sec. 38 of the Act. Subsequently, the respondent -authorities have conducted the audit of the books of accounts of the petitioner for the period 2011 -12 and on verification of the books of accounts and the documents, sales and purchase registers, the officer has noticed some alleged discrepancies in respect of certain purchase turnovers and issued notice under Sec. 39(1) of the Act to conclude the reassessment, proposing to levy tax on the alleged discrepancies. The petitioner is said to have purchased the materials from one M/s. Reddy Trading Company who is a registered dealer having a valid and current TIN number. In relation to the tax period February, 2012, the petitioner has purchased the materials from the said company to the extent of Rs. 60,54,209 by paying taxes thereon and the petitioner has claimed input tax on the said purchases as per Sec. 10(4) of the Act by producing the tax invoice issued by the selling dealer to which petitioner is entitled.