State Of Kerala vs Mytheen Pillai Muhammed Kannu And Ors. on 14 March, 1996
The amendment by the Finance Act, 2008 only
clarifies the fact that the amount covered under credit notes
issued by a supplier that do not affect the input tax credit already
availed shall not be reckoned for the purpose of assessment
under the Act. This provision according to me cannot be extended
to the assessment of turnover for the purpose of payment of tax.
Of course, it could be said that there is some ambiguity to the
provision. But in so far as the liability to pay tax is on the turnover
and discount given is part of the turnover, which is clearly
indicated in Cement House (supra) and Syed Muhammed
(supra), I do not think that a different view is possible to be taken
in the matter.