2025-VIL-464-PAT
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VAT High Court Cases

Bihar VAT Act, 2005 - Disallowance of Entry Tax set off, Interest imposition under BVAT Act - Respondent authority disallowed the claim of Entry Tax set off taken on closing stock for the period 2012-13. The petitioner argued that the disallowance of the Entry Tax set off and the imposition of interest under Section 39(4) of the BVAT Act was arbitrary - Whether the respondent authority was justified in disallowing the claim of Entry Tax set off taken on closing stock for the period 2012-13 – HELD - In the assessment order for the year 2012-13, the Assessing Authority had clearly stated that the petitioner would get the benefit of adjustment of the Entry Tax amount on the closing stocks after sale of the stocks in the coming year. However, when the petitioner claimed the adjustment of the Entry Tax amount on the goods sold in the year 2017-18, the same was disallowed by the respondent authority. The approach of the respondent authority to be unfair and against the principles of natural justice - The respondent authority's own statement in the 2012-13 assessment order contradicted its later stance that there was no provision to allow the adjustment of the Entry Tax amount. Therefore, the respondent authority is required to act fairly by considering the claim of the petitioner for adjustment of the Entry Tax - Since the respondent authority had not allowed the adjustment of the Entry Tax amount, which the petitioner was entitled to, the imposition of interest under Section 39(4) of the BVAT Act was arbitrary and against the principles of fair play. The imposition of interest was unjustified and set aside - the impugned assessment order and demand order is quashed and matter is remitted to the respondent authority to consider the request of the petitioner for adjustment of the Entry Tax amount – The writ application is allowed
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