In Brief
Maya Appliances (now Preethi Kitchen Appliances) manufactures home appliances and grants quarterly performance-based discounts to distributors. The manufacturer claimed these as deductions from taxable turnover. The tax authority disallowed them because they were not shown in the original sale invoices but granted later based on the prior quarter's performance. The High Court upheld the disallowance. The Supreme Court allowed the appeal, holding that trade discounts need not be quantified at the time of each invoice but must be supported by contemporaneous records and reflected in accounts to qualify for deduction from taxable turnover under the Karnataka VAT Act.
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