Karnataka entry tax on goods exported

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This query is : Resolved

Subramanian (Querist)

25 November 2013 We are traders in textile materials and textile machines based in Bangalore.

In year 2007 - 08 we had purchased fabrics from outside Karnataka (from Mumbai) and exported it as such to a customer in UK

We have proof of export like Export invoice, Air way bill & Customs EP Copy

Also we had imported textile machines from UK to Bangalore for the purpose of trading and sold the same outside Bangalore (CST sales against form c)

We had not paid entry tax on both these above transactions as the goods were brought in to local ares (Bangalore) and sold immediately as CST sales or exported to outside India

Today the sales tax audit has issued a notice to us to pay entry tax on the above transaction as per them we have to pay entry tax even if it is sold outside the state or exported.

Kindly advice as whether we have to pay entry tax . If not kindly provide the notification or judgement in this regard

Regards

Subramanian

Bangalore

MJ Krishnamurthy

MJ Krishnamurthy (Expert)

25 November 2013 Yes,the authorities are correct. Entry tax is leviable when the goods are into local area for use,sale or consumption.You have brought the taxable goods and sold from your shop,so the liability arises. If you had returned any of those taxable commodities to th seller/exporter within six months,then you could claim exemption to that extent.If you dispatch such taxable goods to outside the state otherwise than by way of sale also you can claim exemption.....mjk

MJ Krishnamurthy

MJ Krishnamurthy (Expert)