D.O.F:06/09/2019
D.O.O:22/07/2021
IN THE CONSUMER DISPUTES REDRESSAL FORUM, KASARAGOD
CC.No.132/2019
Dated this, the 22th day of July 2021
PRESENT:
SRI.KRISHNAN.K :PRESIDENT
SRI.RADHAKRISHNAN NAIR.M : MEMBER
SMT.BEENA.K.G : MEMBER
M.T.Ahamed Ali, aged 54 years
S/o Abdul Rahiman
R/at Jaseel Manzil, Bevinje, Thekkil Ferry, : Complainant
Chengala, Kasaragod.
(Adv: Udaya Kumar)
And
- The Manager
Amana Toyota,
VPK Motors (P) Ltd: Opposite Parties
Periya, Kasaragod.
(Adv: Satheeshan.P)
- Regional Transport Officer
Civil Station, Vidyanagar
Kasaragod
(Adv: Dist. Govt. Pleader)
ORDER
SRI.KRISHNAN.K :PRESIDENT
The Complaint filed under section 12 of Consumer Protection Act 1986.
The case of the complainant is as follows:-
The complainant is the registered owner of the vehicle Kl-14 V 5444with effect from 1/11/2017. The complainant remitted insurance TDS and other tax amount through Opposite Party No.1 payable to Opposite Party No.2. Complainant received a notice from Opposite Party No.2 dated 29/05/2019 claiming Rs.1,03, 652/- as road tax to be paid within 7 days. Complainant made enquiry then Opposite Party No.2 informed that it is the duty of Opposite Party No. 1 to pay the tax when vehicle is delivered. Complainant suffered mental agony and there is deficiency in service by Opposite Party No.1. Therefore complainant claims Rs.50,000/- as compensation and Rs50,000/- for mental agony and in convenience and to pay cost of litigation.
2. The Opposite Party No.1 filed its written version stating that Opposite Party No. 1issued detailed invoice to the complainant with full details of the taxes payable to the vehicle delivered to him. The variations in the tax if any after delivery of the vehicle, the same shall be settled by the complainant and the tax department. There is no negligence or deficiency in service by Opposite Party No. 1 and stated that Opposite Party No. 1 is an unnecessary party and complaint may be dismissed with cost.
3. The Opposite Party No.2 filed its written version as follows:- Complainant purchased the vehicle on 07/12/2017 registered in the office on 15/01/2018 after remitting the road tax Rs. 298995/- ie. 15% of its value namely Rs. 19,93,300/-. It has come to the notice of the department while computing the purchase value of the value TCS was not taken in to account, resulting a short levy of on time tax of Rs. 103652/- purchase of motor vehicle exceeding Rs. 10,00,000/-, 1% of the TCS is the tax payable by seller which he collects from the buyer at the time of sale. In this case AG audit report disclosed that vehicle price including TCS is Rs. 20,13, 233/-. So tax to be collected is Rs. 402647/- ie 20% of the purchase value Rs. 20,13,233/-. Hence balance tax payable is Rs. 1,03,652/- for which demand notice is issued demanding road tax due to the Government of Kerala.
4. Complainant produced documents marked as Ext A1 to A5. Ext A1 is the tax invoice dated 01/11/2017, Ext A2 is the copy of R.C. Ext A3 is the insurance policy , Ext A4 is the TDS certificate, Ext A5 is the demand notice issued by RTO Kasaragod. Opposite Party No.2 produced documents Ext B1 and B2. Ext B1 is the copy of the letter by Transport Commissioner; Ext B2 is the copy of the audit report.
5. The points for consideration in the above case are
a) Whether the demand notice issued by Opposite Party No.2, demanding short
levy of tax is legally enforceable or not ?
b) Whether there is any deficiency in service from the part of Opposite Party No.1
and Opposite Party No.2, demanding short levy of found due as per the audit
report conducted after the collection of the tax.
c) Whether complainant is entitled to any compensation from the Opposite Party
No.1 and Opposite Party No. 2 and if so for what reliefs?
6. The fact remains that the tax payable to the vehicle was calculated and collected taking into account the price of the vehicle as Rs. 19,93,300/-. As per section 2(V) of the Motor Vehicle Taxations Act and rules, bill of 2017 with effect from 01/07/2017 purchase value of the vehicle includes taxes VAT, GST, and such other taxes as may be levied by central and State Government, CESS and customs/Exercise duty chargeable on vehicle. So evidently TCS has not been taken in to account while computing the purchase value originally and thereby resulted in short levy of onetime tax namely Rs.103652/-. A Tax collected at source (TCS) is the tax payable by a seller which he collects from the buyer at the time of sale section 206 C of the income tax Act governs the goods on which the seller has to collect tax from the purchase.
TCS rate on car
Purchase of Motor Vehicle exceeding Rs. 10 Lakh1% of Ex-showroom cost.
TCS payment and returns the seller deposits the TCS amount in challan 281 within 7 days from the last day of the month in which the tax was collected.
Every tax collector
Every tax collector has to submit quarterly TCS return ie in form 27 EQ in respect of the tax collected by him in a particular quarter.
Certificate of TCS
When a tax collector files his quarterly TCS return ie, from 27 BQ he has to provide TCS certificate to the purchaser of the goods. Form 27 D is the certificate issued for TCS returns filed.
TCS was meant for tracing the buyers and to minimize tax evasion. There is no blocking of its credit unlikely which is in GST for some specific situations. It was introduced to force buyers to file their return and disclose their income to the IT authorities so that IT authorities can critically examine the buyers taxable income from expenditure and from its disclosed income.
TCS collected by the seller is in addition his sale value and the same is separately recorded/shown on the invoice. The additional amount paid by buyer by way of TCS will reflect in his 26 AS statement after the seller filed his TCS return. Buyer can avail its credits from its tax liability payable to the IT authorities.
In case the buyer has no tax liability, there TCS amount will be refunded after filing of Income Tax Return. The TCS collected by the buyer is credited against the PAN of the buyer. Tax statement 26 A5 will shown it and he can claim from it by deducting it from total tax payable for the year. If no tax is payable buyer get a refund.
In this case demand notice is issued tax is to be paid by seller to be collected from buyer and buyer will get its refund if no tax is payable by him.
Opposite Party No: 2 produced Ext B1, the copy of the letter by transport Commissioner, accompanied By Ext B2 the copy of the audit report. It clearly establishes that it is short levy of road tax payable without noting Taxation amendment bill with effect from 01/07/2017. Therefore any amount by way of short levy of road tax of the vehicle purchased on and since 01/01/2017 is subject to payment of road tax including tax collected at source. Therefore demand made by Opposite Party No:2 against the complainant is an amount legally due and claim for amount legally due is legally enforceable.
Thus complaint of deficiency in service or negligence on the part of No.1 or 2 is devoid of any merits. Hence liable is to be rejected. In particular the amendment is noticed by the Opposite Party No:2 only after the receipt of the audit report and at the time of issue of demand notice later by Opposite Party No:1.
Unless and until the amendment bill 2017 referred to above is challenged and stuck off as unenforceable, Opposite Party No:2 is legally bound to recover the short levy of the tax in accordance with the procedure established by law.
In the circumstances and reasons aforesaid the complaint is dismissed without any order as to cost.
Sd/- Sd/- Sd/-
MEMBER MEMBER PRESIDENT
Exhibits
A1-Tax Invoice
A2- Copy of R.C
A3- Insurance Policy
A4-TDS certificate
A5- Demand notice
B1- Copy of the letter by Transport Commissioner
B2- copy of audit report
C1- Commission Report
Sd/- Sd/- Sd/-
MEMBER MEMBER PRESIDENT
Forwarded by Order
Senior Superintendent
Ps/
