In the case of Commercial Tax Officer vs. Jyoti Electronics (2015) 57 taxmann.com 381 (Rajasthan), on 18th March 2015, it has been held at Rajasthan High Court that once a whole seller has issued VAT invoice to purchaser of goods, then input tax credit is allowable as per said invoice alone even if goods are sold at a price lower than their purchase cost./p>

In the said case, the assesse had purchased the goods after the payment of input tax, and he got trade discount from the whole seller. He claimed ITC based on the invoice value but sold the same goods to the consumer even lower than the bill value of purchases. The assessing authority claimed that the since the assesse took ITC on the higher side than the ultimate sales value, the differential tax was levied accordingly. However, the Deputy Commissioner (Appeals) allowed the appeal of the assesse and held that ITC has been rightly claimed./p>

Further, after reviewing the case on the appeal of the department, the Tax board also upheld the decision of the First Appellate Authority. Furthermore, the Tax board held that it is none of the business of the revenue to interfere in the affairs of the assessee. It is also not debarred under the sales tax law and/or VAT law to sell the goods below the invoice value. Once a whole seller has issued VAT invoice to purchaser of goods, then input tax credit is allowable as per said invoice alone and the same requires to be allowed to the assessee.