ALLAHABAD HIGH COURT: STRICKER APPROACH TO BE FOLLOWED BEFORE GIVING BENEFIT EXEMPTIONS AND DEDUCTIONS UPVAT RULES

The Allahabad High Court in the case the Commissioner, Commercial Tax U.P. v. S/S Sanya Construction and Developers Pvt. Ltd observed and has held that though in case of doubt, the taxing statues are to be interpreted in favour of the assesee.

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The Court in the case stated that a stricter approach needs to be followed before giving the benefit of exemptions and the deductions.

The bench headed by Justice Shekhar B. Saraf in the case observed and has stated that the general rule of law in taxing statutes is that in case of any doubt, the benefit should be given to the assessee. Thus, in cases of exemption and the deduction to be given, the stricter approach may be followed, as per the judgement of the Supreme Court in order to examine whether the assessee is being eligible for such kind of benefit.

In the said case, the department filed the revision plea challenging the decision of the Commercial Tax Tribunal wherein the turnover of the assessee was reduced as per Rule 9 of the Value Added Tax Rules on grounds that the cement imported from outside the State of Uttar Pradesh.