South Indian Oil Corporation Vs Assistant Commissioner Central Tax Division-1 (Karnataka High Court)
Karnataka High Court held that refund of accumulated Input Tax Credit in case where the input and output tax are the same is allowed. Accordingly, order is liable to be set aside and refund claim deserved to be allowed.
Facts- The petitioner is engaged in the business of procuring various edible oils such as Sunflower oil, Rice bran oil, Cottonseed oil, Palm oil etc., falling under HSN Code 15 on payment of tax at 5%. The said edible oils are purchased in bulk in tankers and then packed into various containers bearing the net weight of 250 ml, 500 ml, 1 litre or 5 litre at their premises for selling by way of both business to business and also business to customers at the tax rate of 5% under the same HSN Code 15. Under these circumstances, the petitioner accumulated ITC and sought for refund of the accumulated and unutilised ITC on account of rate of tax on certain inputs being higher than the rate of tax charged on packed edible oil which is the output supply and sought for refund in this regard as per the refund applications filed by the petitioner. The issue as to whether the petitioner would be entitled to refund.
