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Burden
The Supreme Court reiterated
that the burden to prove that there was an activity which amounted to
manufacture, continued to be on the Revenue.
Commissioner, Central Excise,
Lucknow vs. M/s Wimco Ltd. JT 2007 (11) SC 628.
Cancellation of registration
The Madras High Court
disapproved the cancellation of registration on failure of the assessee to
submit the application within the prescribed time limit prescribed by the
subordinate legislation and not the Act. The assessee was, however, directed to
submit the application within a period of one week from the date of the
judgment.
M/s Majri Steels vs. Commercial
Tax Officer, Tiruchy.
Source : Sales Tax Matters, 1st
Nov. 2007, Vol. 10 Part 11, Page 1188.
Clarification
1. Calcium Carbonate
The Commissioner of Commercial
Taxes, Kerala, clarified under section 94 of the Kerala VAT Act that calcium
carbonate being the raw material used in the manufacture of PVC pipes, was
taxable @ 4% under entry 22(7) of List A appended to the Third Schedule with HSN
Code 2836.50.
Source : Kerala Tax Reporter,
Vol. 15 Part XI, Page 283.
2. Multifunction Printers
The Commissioner of Commercial
Taxes, Kerala, clarified under section 94 of the Kerala VAT Act that
multifunction printers were liable to tax @ 4% under Sr. No. 69(22)(a) of Third
Schedule appended to the Kerala VAT Act.
Source : Kerala Tax Reporter,
Vol. 15 Part XI, Page 293.
3. Digital multifunctional
devices
The Commissioner of Commercial
Taxes, Kerala, clarified under section 94 of the Kerala VAT Act that
multifunctional printers, copiers and scanners were covered by Schedule
69(22)(a) of the Third Schedule and therefore liable to be taxed @ 4%.
Source : Kerala Tax Reporter,
Vol. 15 Part XI, Page 296.
4. Deduction of tax
The Government of Kerala
decided to reduce the rate of tax on generators and medical equipments from
12.5% to 4% effective from 22nd October, 2007.
Source : Kerala Tax Reporter,
Vol. 15 Part XI, Page 298 .
Declared goods
The Himachal Pradesh High Court
held that for the purpose of Section 14 of the Central Sales Tax Act, maize was
a coarse grain which is exempt under item No. 13 of Schedule B, appended to the
Himachal Pradesh VAT Act 2005, though for the purpose of C.S.T., the same was
declared goods, but simply because of that position, it was not necessary that
the item must be taxed even when the same was covered by Schedule B which inter
alia enumerated the description of goods exempt from tax.
M/s Namdhari Enterprises vs.
State of Himachal Pradesh.
Source : Sales Tax Matters, 1st
Nov., 2007, Vol. 10 Part 11, Page 1065.
Inter-State Works Contract
Before the Haryana Tax
Tribunal, the material required to be used in the Works Contract at Delhi, were
brought from the State of Haryana, pursuant to the order in question. The
Tribunal held the nature of the transaction to be that of inter-State and not an
intra-State sale. For that purpose, the Tribunal followed the well laid down
principle of law that once a transaction was held to be covered by section 3 of
Central Sales Tax Act, 1956, the property may pass in one or the other State. In
other words, that aspect of the matter was irrelevant for finding out the nature
of the transaction. Since in the instant case, the material used in the contract
in Delhi moved from Haryana pursuant to the contract, the nature was held to be
that of inter-State sale and not intra-State in Delhi.
Commissioner of VAT, Department
of VAT, Govt. of NCT of Delhi, New Delhi vs. State of Haryana & Others (2007) 30
PHT 547 (HTT).
Inter-State transfer for job
work and inter-State return the Allahabad High Court, after considering the
scheme of the Central Sales Tax Act and the provisions of section 6A, held that
even when the goods were sent to and received from places outside the State for
the purpose of carrying out the job work, the declaration in Form ‘F’ was
essential because the transfer of goods from one State to another was otherwise
than by way of sale. Failure to furnish such a declaration would result the
transaction to be that of deemed sale.
M/s Ambica Steels Ltd vs. State
of U. P. & Others (2007) 30 PHT 604 (All).
Limitation – Law applicable
Before the VAT Tribunal,
Punjab, the limitation for passing the assessment order for the years 1992-93 to
1994-95 were five years. With effect from 20th April, 1998, the provision in
regard to limitation was amended and curtailed to three years. The Tribunal
rejected the plea of the assessee that the law of limitation being procedural
law it was applicable retrospectively, and held that the old period would be
governed by the old law that prevailed on the date of filing of the return.
State of Punjab vs. M/s Molins
of India Engg. Ltd., Mohali (2007) 30 PHT 587 (PVT).
Parties to the proceeding
Before the Punjab & Haryana
High Court, the buyer filed a petition seeking to challenge the order passed by
Sales Tax Tribunal, Punjab, against the seller from whom the petitioner had
effected the purchase. The Punjab & Haryana High Court, dismissing the petition,
held that in any of the proceeding before the lower authorities, the petitioner
was not a party and therefore it cannot challenge the order of the Tribunal in
question.
M/s Lavino Kapur Cottons Ltd.,
Mumbai vs. State of Punjab.
Source : Sales Tax Matters, 1st
Nov., 2007, Vol. 10 Part 11, Page 1075.
Per Incuriam
Any observation made in a
judgment without noticing or considering an earlier Larger Bench decision of the
Supreme Court suffer from the vice of per incuriam.
Commissioner, Central Excise,
Lucknow vs.
M/s. Wimco Ltd. JT 2007 (11) SC
628.
Registration
The Punjab & Haryana High Court
quashed the notice issued by the Taxation Officer to the seller from other State
who had sold the goods to a dealer in Punjab in the course of inter-State trade
and awarded a cost of Rs. 10,000/- to be recovered from the officer issuing such
a notice. The cost so collected was ordered to be paid to the petitioner. The
High Court, while allowing the petition, held that dealers from other States
were not required to be registered under the Punjab VAT Act. The Hon’ble Court
directed the Commissioner to hold enquiry into such a lapse by the officer.
M/s Osaw Agro Industries Pvt.
Ltd vs. State of Punjab.
Source : Sales Tax Matters, 1st
Nov., 2007, Vol. 10 Part 11, Page 1115.
Refund
1. Considering the delay
in making payment of refund by the department pursuant to the order of the
Tribunal, the Punjab & Haryana High Court held that the assessee in question was
entitled to get an interest for such delay @ 12% per annum for the first month
and @ 18% per annum for all the subsequent months.
M/s Escotel Mobile
Communication Ltd vs. State of Haryana.
Source : Sales Tax Matters, 1st
Nov., 2007, Vol. 10 Part 11, Page 1163.
2. The Punjab & Haryana
High Court disapproved the withholding of refund due to the assessee on the plea
that certain proceedings under the Act were still pending against the assessee.
The department was directed to refund the amount with interest and the cost of
Rs. 10,000/- in each case.
M/s Sadhu Overseas vs. State of
Haryana & Another (2007) 30 PHT 582 (P&H).
3. The Supreme Court,
while considering the impact of exemption notification read with industrial
policy granting exemption of sales tax to the Unit in the backward area, held
that the assessee purchasing the raw material on payment of sales tax was
entitled to get the refund, where the raw material was taxable at single point
tax. The Supreme Court, however, rejected the plea of interest on the refund
made by the assessee by observing that the quantum of refund having not been
determined, no interest was eligible to be paid to the assessee.
Commissioner of Sales Tax,
Orissa & Others vs. M/s Crown Re-roller (P) Ltd. & Others (2007) 50 S. T. A. –
246.
Reassessment
The Allahabad High Court held
that merely because the Commissioner changed his view or opinion and reviewed
his earlier circular, no reassessment proceeding can be initiated for the
assessment completed on the basis of the earlier circular.
M/s Ambika Steels Pvt. Ltd vs.
State of Uttar Pradesh and Others. 2007 NTN (Vol. 35) – 126.
Revision
The Supreme Court, while
construing Section 21 of the Punjab Co-op. Soc. Act, 1961, held that although no
period of limitation was prescribed, the power should be exercised within three
years, but not beyond five years.
State of Punjab vs. Bhantinda
Dist. Co-op. Milk Producers Union Ltd. JT 2007 (12) SC 314.
Sale in the course of export –
Section 5(3) of the C.S.T Act
The Division Bench of the
Supreme Court referred the matter to a Larger Bench for reconsidering the scope
of section 5 of the Central Sales Tax Act in a case where the foreign buyers had
placed orders for a complete bus giving specifications of the chassis and the
bus body; where the assessee manufactured the chassis and then placed orders for
building bus bodies on such chassis.
State of Karnataka vs. M/s Azad
Coach Builders Pvt. Ltd. etc. 2007 NTN (Vol. 35) – 150.
Scope of Revisional
Authority
The Punjab & Haryana High
Court, while construing the scope of Section 40 of the Haryana Sales Tax Act,
held that the Revisional authority cannot initiate the penalty proceeding for
the first time where the assessing authority had not invoked its jurisdiction of
imposing the penalty.
M/s Choudhary Tractor Company,
Tohana vs. State of Haryana (2007) 30 PHT 573 (P&H)
Sale price
The Supreme Court, while
considering the levy of custom duty on the purchase price of the goods, held
that the price of the imported plant and machinery cannot be increased by the
value of the licence and technical know-how. The value was to be determined at
the time and place of importation. The Supreme Court also observed that the
assessment of custom duty should have a direct nexus with the value of the goods
that was payable at the time of importation and any amount that was payable
after importation was complete for setting up of the plant from the machinery
imported; cannot form part of the sale price.
Commissioner of Customs (Port),
Kolkata vs. M/s J. K. Corporation Ltd. (2007) 50 S. T. A – 233.
Taxable goods
The Supreme Court held that
simply because an item was covered by a tariff entry, it does not become
excisable unless there was manufacture and the goods were marketable.
Commissioner, Central Excise,
Lucknow vs. M/s Wimco Ltd. JT 2007 (11) SC 628
Works Contract – TDS
The petitioner before the
Madhya Pradesh High Court, undertook the work of giving technical advice, labour
supervision and engineering service. The work did not involve any supply of
goods. The Madhya Pradesh High Court held that no deduction was warranted from
the payments made to such service provider.
M/s Jaihind Projects Ltd vs.
State of Madhya Pradesh.
Source : Sales Tax Matters, 1st
Nov. 2007, Vol. 10 Part 11, Page 1142.
Words & Phrases – Assess
The Supreme Court held that the
word ‘assess’ in section 16D of the Orissa Sales Tax Act, 1947 and section 12 of
the said Act had different connotations. While Section 16D referred to the
release of the goods on payment of the amount assessed by the Vigilance Sales
Tax Officer, section 12 provided for computation of the tax for the year in
question after analysing the return furnished by the dealer. The Supreme Court,
therefore, held that the assessment by the Vigilance Officer has nothing to do
with the regular assessment under Section 12 of the Act.
Sales Tax Officer vs. M/s Dutta
Traders.
Source : Sales Tax Matters, 1st
Nov., 2007, Vol. 10 Part 11, Page 1156.
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