M/S. S. L. N. Coffee Private Limited vs. The State Of Karnataka

Heard Shri C.S.Suryakanth, learned advocate for the petitioner and Shri Aditya V.Bhat, learned AGA for the respondent.

Undisputed facts of the case are, petitioner and M/s.Chimco are both registered dealers. Petitioner has purchased coffee seeds from M/s.Chimco during the 1 ‘M/s Chimco’ for short NC: 2024:KHC:1093-DB assessment year 2009-10. The assessee has paid an output tax of Rs.78,86,156/-. The same is discernable in the Assessment Order2. 4. By the impugned order, the full Bench of the Tribunal has reversed the input tax credit of Rs.69,15,450/- on the ground that there was no material/document on record which could demonstrate beyond doubt that sale transaction between the dealer and the appellant as genuine.

Learned advocate for the petitioner, adverting to para 48 of the impugned order, submitted that the full Bench of the Tribunal has noted that there was no doubt regarding movement of goods. Adverting to Annexure-F, he pointed out that assessment order notes that the appellant has declared purchase of coffee seeds from assessee-company (M/s.Chimco) and an output tax of Rs.78,86,156/- has been paid.

Learned AGA, opposing the petition, submitted that transaction between the parties is not genuine. M/s.Chimco has been deregistered and it’s existence is also doubtful. With these submissions, he sought to sustain the reversal order made by the full Bench of the Tribunal.

We have carefully considered rival submissions and perused records.

So far as first objection of the Revenue that transaction is not genuine, we may record that Annexure-F is the Assessment Order for the tax period 01.04.2009 to 31.03.2010. In para 3 of the order, it is recorded that assessee, M/s.Chimco had declared purchase of coffee seeds from M/s.SLN Coffee Pvt. Ltd., and an output tax of Rs.78,86,156/- has been paid. The assessment has been made by the Additional Commissioner of Commercial Taxes. The document speaks for itself that so far as petitioner was concerned, the tax amount was paid.

With regard to second contention that M/s.Chimco was deregistered, the document (Annexure-M) NC: 2024:KHC:1093-DB filed by the assessee shows that deregistration has been approved on 16.07.2011 and the effective date of deregistration mentioned therein is from 01.06.2006. The assessment year is 2009-10. As on that date, the said firm was not deregistered and it is only on 16.07.2011, deregistration has been retrospectively made. Hence, second contention also fails.

The third contention is that M/s.Chimco does not exist. The assessment order and deregistration order clearly show that said private limited company was registered with Commercial Tax Department and the assessment has been made by an officer of the rank of Commercial Tax Officer. Therefore, third contention also must fail.

In para-4 of the impugned order, full Bench of the Tribunal has recorded thus: “48.However, by filing a memo dated 12.04.2023, the advocate for appellant has produced Xerox copy of transporting bills issued by M/s.Vinayaka Lorry Service Transport Contractors, Kushalnagar, towards hire charges of their lorry bearing registration No.KA.12-5151 and used for transportation of coffee from CHIMCO to SLN Coffee premises and payment vouchers are produced. Further, it is stated in the said memo that the other trucks bearing registration No.KA.12- 7900, KA.12-8431, KA 12-7918 and KA.12-9083 are used for transportation of NC: 2024:KHC:1093-DB coffee from M/s CHIMCO International Pvt. Ltd. to appellant’s place of business and they were/are owned by the appellant. Hence, the said documents in respect of movement of goods cannot be doubted.” (Emphasis Supplied)

Once movement of goods is accepted and in the assessment order of M/s.Chimco, the Assessing Officer has noted payment of output tax in a sum of Rs.78,86,156/-, the contentions urged on behalf of the Revenue are untenable and liable to be rejected. In view of the above, the following: ORDER i) Revision Petition is allowed; ii) Order dated 24.05.2023 in STA No.270/2019 passed by the full Bench of the Karnataka Appellate Tribunal, Bengaluru, is set-aside; and iii) The question of law is answered in favour of the Assessee and against the Revenue.