Content Provider | Supreme Court of India |
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e-ISSN | 30484839 |
Language | English |
Access Restriction | NDLI |
Subject Keyword | Karnataka Value Added Tax Act 2003: s.2(34) - Post sale |
Content Type | Text |
Resource Type | Law Judgement |
Jurisdiction | India |
Case Type | Appeal |
Court | Supreme Court of India |
Disposal Nature | Appeal Allowed |
Headnote | Karnataka Value Added Tax Act, 2003: s.2(34) - Post sale discount - Determination of taxable turnover - Issue of credit notes to the customers granting discounts - Assessee retaining only the net amount that is, the amount shown in the invoice less the sum of discount disclosed in credit note - Claim for deduction towards discount accorded by credit notes from the total turnover to quantify the taxable turnover - Held: A plain reading of s.3(2)(c) reveal that all amounts allowed as discount qualify for deduction from the total turnover to ascertain the taxable turnover - A trade discount conceptually is a pre sale concurrence, the quantification whereof depends on many factors in commerce - Such trade discounts ought not to be disallowed only if they are not payable at the time of each invoice or deducted from the invoice price - The overall review of the scheme of the Act and the Rules and the underlying objectives in particular of ss.29 and 30 of the Act and r.3 of the Rules shows that the requirement of reference of the discount in the tax invoice or bill of sale to qualify it for deduction has to be construed in relation to the transaction resulting in the final sale/purchase price and not limited to the original sale sans the trade discount - However, the transactions allowing discount have to be proved on the basis of contemporaneous records and the final sale price after deducting the trade discount must mandatorily be reflected in the accounts as stipulated under r.3(2)(c) of the Rules - Karnataka Value Added Tax Rules, 2005 - r. 3(2)(c) and its proviso. Interpretation of statutes: Literal interpretation - Held: Though words in a statute must be extended their ordinary meanings, but if the literal construction thereof results in anomaly or absurdity, the courts must seek to find out the underlying intention of the legislature and in the said pursuit, can within permissible limits strainthe language so as to avoid such unintended mischief - Karnataka Value Added T(J)( Rules, 2005 - r.3(2)(c) and its proviso. |
Judge | Hon'ble Mr. Justice Amitava Roy |
Neutral Citation | 2017 INSC 55 |
Petitioner | M/s Southern Motors |
Respondent | State Of Karnataka And Others |
SCR | [2017] 2 S.C.R. 434 |
Judgement Date | 2017-01-18 |
Case Number | 10955-10971 |
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