India Cements Ltd v. The State Of Tamilnadu

IN THE HIGH COURT OF JUDICATURE AT MADRAS

DATED: 03.06.2015

CORAM:

THE HONOURABLE MR.JUSTICE R.SUDHAKAR and THE HONOURABLE Ms.JUSTICE K.B.K.VASUKI Tax Case (Revision) No.45 of 2015 India Cements Ltd., 827, Anna Salai, Chennai - 600 002.

.. Petitioner/Petitioner versus The State of Tami lNadu, represented by the Assistant Commissioner (CT)-I, Fast Track Assessment Circle-II, Chennai - 600 006.

.. Respondent/Respondent PRAYER: Tax Case (Revision)filed under Section 38 of the Tamil Nadu General Sales Tax Act, 1959 against the order dated 03.10.2005 in T.A.No.270 of 2000 against the order of the Deputy Commissioner (CT) Appeals III Floor, Wavoo Complex, 191, N.S.C.Bose Road, Chennai-1 dated 20.3.2000 and made in App.No. and year 25/99 and against the proceedings of the Assistant Commissioner (CT) Faast Track Assessment Circel II dated 26.2.1999 and made in TNGST/072053/88-89 on the file of the Sales Tax Appellate Tribunal, (Main Bench), Chennai for the assessment year 1988-1989.

For Petitioner : Mr.N.Inbarajan

O R D E R

(Judgment of the Court was delivered by R.SUDHAKAR,J.) This Tax Case (Revision) is filed by the assessee as against the order of the Sales Tax Appellate Tribunal.

2. It is submitted by the learned counsel appearing for the petitioner/assessee that the issue involved in this revision with regard to levy of purchase tax under Section 7A of the Tamil Nadu General Sales Tax Act is covered by a decision of this Court in respect of the very same assessee in the case of India Cements Limited V. State of Tamil Nadu reported in [2012] 51 VST 286, wherein this Court, while answering the issue against the assessee and in favour the Revenue, held as follows:

"A reading of these decisions of this court and in the context of the decision reported in [1993] 88 STC 98 (SC) (Hotel Balaji v. State of Andhra Pradesh) and [1975] 36 STC 191 (SC) (State of Tamil Nadu v. M.K.Kandaswami), it is thus clear that the scheme of purchase tax levy under section 7A of the Act does not cover cases of sale or purchase of goods totally exempted from tax at all points under section 8 or section 17(1). However, where the exemption is a qualified one, be it goods related or dealer related, purchase or sale of goods subjected to any of the contingencies enumerated under section 7A, would certainly attract the charge under section 7A of the Act.

Going by these decisions, we have no hesitation in rejecting the plea of the assessee that the notification granting exemption to sale by Tamil Nadu Electricity Board cannot be considered as a circumstance to apply to the assessee to exclude the charge under section 7A of the Act. Quite apart from that section 7A itself underwent an amendment with effect from January 1, 1987 which reads as follows: " 7A. Levy of purchase tax.

Provided that a dealer (other than a casual trader or agent of a non-resident dealer) purchasing goods (the sale of which is liable to tax under subsection (1) of section (3)) shall not be liable to pay

tax under this sub-section, if his total turnover for a year is less than one lakh of rupees".

The amendment brought to section 7A of the Act with effect from January 1, 1987 by notification and the phrase "not being a circumstance in which goods liable to tax under sub-section (2) of section 3 or section 4, were purchased at a point other than the taxable point specified in the First or the Second Schedule) and either" was considered by this court in the decision reported in [2008] 12 VST 546 (Mad) (Ruchi Soya Industries Limited v. Commercial Tax Officer, Harbour III Assessment Circle, Chennai), and similar contention now taken was rejected. Thus, this Court applying the decision of the apex court, rejected the plea of the assessee and confirmed the assessment made under section 7A of the Act.

In the light of the provisions under section 3 as well as section 7A of the Act, before the amendment in the 1986, i.e., upto December 31, 1986, and thereafterwards from January 1, 1986 onwards, we have no hesitation in holding that the assessments were correctly made and the Tribunal's order is in accordance with the principle of law laid down by the apex court in the decision reported in [1975] 36 STC 191 (SC) (State of Tamil Nadu v. M.K.Kandaswami) and in the decision reported in [1993] 88 STC 98 (SC) (Hotel Balaji v. State of Andhra Pradesh)"

3. Recording the above-said submission of the learned counsel appearing for the petitioner and following the above-said decision of this Court, the question of law is answered against the assessee. Accordingly, this Tax Case (Revision) stands dismissed. No costs. -s/d- Assistant Registrar True Copy Sub-Assistant Registrar sl To

1. The Sales Tax Appellate Tribunal, (Main Bench), Chennai.

2. The Assistant Commissioner (CT)-I, Fast Track Assessment Circle-II, Chennai - 600 006.

3. The Deputy Commissioner (CT) Appeals, III Floor, Wavoo Complex, 191, N.S.C.Bose Road, Chennai 1.

+ 1 cc to the Special Government Pleader (Taxes) SR 26978 + 1 cc to Mr.N.Inbarajan, Advocate SR 26243 ug(co) prk16/6 Tax Case (Revision) No.45 of 2015