IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR. JUSTICE K.SURENDRA MOHAN WEDNESDAY, THE 11TH FEBRUARY 2009 / 22ND MAGHA 1930 ST.Rev..No. 410 of 2006() ------------------------- TA.2(A)/2005 of S.T.A.TRIBUNAL ADDL.BENCH,PALAKKAD .................... REVISION PETITIONER/ASSESSEE: --------------------------------------- I.T.E.L. INDUSTRIES LTD., 3E, MOUNT CHAMBERS, 758, ANNA SALAI, CHENNAI-2 (FORMERLY M/S. TATA TELECOM LTD., KANJIKODE, PALAKKAD). BY ADV. SRI.JACOB SEBASTIAN RESPONDENT/REVENUE: --------------------------- STATE OF KERALA, REPRESENTED BY SECRETARY TO GOVERNMENT, DEPARTMENT OF REVENUE, GOVERNMENT SECRETARIAT, TRIVANDRUM. BY GOVERNMENT PLEADER, SRI.MOHAMMED RAFFIQ THIS SALES TAX REVISION HAVING BEEN FINALLY HEARD ON 11/02/2009, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: C .N. RAMACHANDRAN NAIR & K. SURENDRA MOHAN, JJ. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - S.T.Rev. No. 410 OF 2006 and C.M. Appl. No. 942 OF 2006 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Dated this the 11th day of February, 2009 JUDGMENT Ramachandran Nair,J. Heard counsel for the petitioner and the Government Pleader. Since petitioner has explained delay on account of pendency of proceedings before BIFR, we condone the delay and allow the delay condonation petition. The question raised in this revision case is whether petitioner is liable to pay tax on the value of DEPB(Duty Entitlement Pass Book) credit available on export of goods. Government Pleader pointed out that the issue is settled by a judgment of Supreme Court in Yasha Overseas v. Commissioner of Sales Tax & others [2008 (17) VST 182] wherein the Court held that transfer of DEPB benefit attracts sales tax. However, the specific case of the petitioner is that credit available was adjusted towards payment of import duty. We notice STRV : 410/2006 -:2:- that this is only a statement in the profit and loss account and the officer has not examined the imports made by the petitioner, its value, duty payable and the adjustments from DEPB credit recorded by the customs authorities in the bill of entry. It is not even known whether import is made by the same company which had DEPB credit on exports made. Of course, if the same company which got credit of DEPB imported goods from outside Kerala and utilised credit against the customs duty payable, it cannot be treated as turnover as there is no sale. However, if credit is transferred and another company adjusted credit against customs duty on goods imported by them, then the petitioner is liable to pay tax, because without transfer of credit another person cannot claim adjustment of customs duty against credit in Pass Book. The tax revision case is disposed of giving one more opportunity to the petitioner to produce before the officer the bills of entry by showing the adjustment of DEPB credit against actual imports made by the petitioner. However, if this is not proved, the assessment shall stand confirmed. Petitioner is given two months' time from receipt of this judgment to produce the bills of entry and other documents to prove import of STRV : 410/2006 -:3:- goods and adjustments of duty credit against customs duty payable on such imports. (C.N.RAMACHANDRAN NAIR) Judge. (K. SURENDRA MOHAN) Judge. ttb STRV : 410/2006 -:4:-