Denial of ITC on zero rated sales u/s. 18 of TNVAT Act 2006 needs fresh consideration: Madras HC

Tvl.Fresh and Honest Cafe Limited Vs Assistant Commissioner (ST) (Madras High Court)

Madras High Court remitted the matter back for fresh consideration in the matter of denial of Input Tax Credit (ITC) on Zero Rated Sales effected under section 18 of the Tamil Nadu Value Added Tax (TNVAT) Act, 2006.

Facts- The petitioner is before this Court against the Impugned Re-assessment Order dated 04.01.2022 passed by the respondent.

Earlier, the Re-assessment Order came to be passed on 28.05.2015 wherein, the respondent had denied the benefit of G.O.Ms.No.36, Commercial Taxes and Registration (B2) Department dated 01.04.2008 to the petitioner, a registered dealer in Coffee Beans and Seed, Coffee Vending Machines namely Tvl.Fresh and Honest Cafe Limited, Chennai. The respondent also denied the Input Tax Credit on Zero Rated Sales effected by the petitioner u/s. 18 of the Tamil Nadu Value Added Tax (TNVAT) Act, 2006.

The petitioner filed appeal before the Appellate Commissioner in Appeal No & Year : 310/2015 (VAT). The petitioner has disputed the reversal of the Input Tax Credit, levy of tax and penalty. By an order dated 13.10.2016, the Appellate Commissioner had remitted the case back to the respondent, which has now culminated in the Re-assessment Order dated 04.01.2022, which is impugned herein.