Law: Sales Tax Act, 1990

Section: 3(9A),7,11,11(2),25,30(2A),38,45-B(3),72 B

SALES TAX ACT, 1990 (VII OF 1990)---Sections: 3(9A), 7, 11, 11(2), 25, 30(2A), 38, 45-B(3) & 72B - Assessment of tax and recovery of tax not levied or short levied or erroneously refunded - Scope of tax - Access to record, documents, etc: - Appointment of authorities - Retailer - Opted out to pay turnover tax @ 2% on its total turnover without any adjustment of input tax up to 30.06.2021 - Filed sales tax returns - Appellant required to pay sales tax at standard rate of 17% while filing its returns from July 2019 - Scrutiny of record revealed that the appellant had adjusted input tax carried forward from the previous sales tax returns which was inadmissible - Show Cause Notice - Case remanded to the Department for de novo consideration - Challenge to - FACTS Brief facts of the case as gathered from the record are that the taxpayer is a Retailer and had opted out to pay turnover tax @ 2% on its total turnover including turnover of exempt supplies u/s. 3(9A) of the Sales Tax Act, 1990 without any adjustment of input tax up to 30th June, 2021 and filed its sales tax returns accordingly till June, 2019. The retailers’ regime for payment of turnover tax @ 2% was abolished w.e.f. 1st July, 2019 and accordingly the appellant was required to pay sales tax at standard rate of 17% while filing its sales tax returns from July 2019. However, scrutiny of appellant’s sales tax record for the tax period of July & August, 2019 revealed that the appellant had adjusted input tax carried forward from the previous sales tax returns which was inadmissible. In order to pay off its sales tax liability for the tax periods July and August, 2019, the appellant had adjusted an amount of Rs.6,811,664 (Rs.4,039,482) in the month of July, 2019 and Rs.2,772,000 in the month of August, 2019. On account of inadmissible input tax adjustment, the appellant was issued a show cause notice. Therefore, in the light of above the case was remanded back to the department for denovo consideration, with the direction to follow the procedure and guidelines mentioned in the STGO No.105/2019 dated 13-09-2019 and also to check whether the appellant had paid sales tax on zero-rated supplies reflected in their…

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