Subburaj Cotton Mills P Ltd. v. The State Of Tamil Nadu
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED : 04.05.2017
CORAM:
THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAM and THE HONOURABLE MR.JUSTICE P.VELMURUGAN TAX CASE(MD)No.6 of 2011 M/s.Subburaj Cotton Mills (P) Ltd., Srivilliputhur Road, Rajapalayam.
.. Petitioner Vs.
The State of Tamil Nadu rep. by its Commercial Tax Officer-II, Rajapalayam.
.. Respondent PRAYER: Tax Case Revision is filed under Section 38 of the TNGST Act, 1959, to revise the order of the Tamil Nadu Sales Tax Appellate Tribunal (Additional Bench), Madurai in M.T.S.A.No.484/2002, dated 15.12.2010.
For Petitioner : Mr.S.Karunakar For Respondent : Mr.R.Karthikeyan, Additional Government Pleader.
ORDER
[Order of the Court was made by T.S.SIVAGNANAM, J.] Heard Mr.S.Karunakar, learned counsel, appearing for the petitioner as well as Mr.R.Karthikeyan, learned Additional Government Pleader appearing for the respondent. 2.This Tax Case Revision has been filed by the assessee challenging the order passed by the Tamil Nadu Sales Tax Appellate Tribunal in the appeal filed against the assessment made on the petitioner dealer. The question of law is whether the transfer of hank yarn obligation is akin to transfer of REP licence / exim scrips involving all the element of sale including bargaining between seller and buyer and consideration for such transfer. 3.The question has already been decided by the Honourable Supreme Court in the case of Rajaratna Mills Limited v. Commercial Tax Officer-1, Palani in Civil Appeal No.62 of 2008, dated 08.04.2016, by passing the following order:
"After hearing learned counsel for the parties, we are of the opinion that the High Court has rightly held that once the hank yarn obligation created by excess production is transferred in the form of scrip, thereafter it would take the character of goods and would be exigible to sales tax. The finding to this effect of the High Court is, thus, without blemish and does not call for any interference.
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It was also argued by the learned counsel for the appellant that it was not a case where the penalty should have been imposed. It was argued that since the hank yarn utilisation was transferred only for statistical / date purposes without giving actual delivery of the hank yarn, the penalty should not have been imposed. The High Court has not dealt with this aspect. We find that a specific plea was taken in this behalf in the writ petition filed before the High Court. It is submitted in the grounds mentioned in the appeal that this plea was raised before the High Court as well.
Normally, in such circumstances, we would have relegated the appellant to the High Court to raise this plea and would have called upon the High Court to decide the same. However, we find that the impugned order is of the year 2004 and no useful purpose would be served in remanding the case on this limited aspect to the High Court. More so, when the entire record to decide the issue is placed before this Court as well.
Thereafter, we have considered the aspect of penalty as well on merits and find substance in the aforesaid contention of the learned counsel for the appellant.
Thus, this appeal is allowed to a limited extent. While retaining that part of the order whereby liability of sales tax is imposed upon the appellant, we set aside the penalty that is imposed.
The appeal is disposed of in the aforesaid terms." 4.Following the referred decision of the Honourable Supreme Court, this Tax Case Revision is dismissed. No costs. Sd/- Assistant Registrar (RTI) /True copy/ Sub Assistant Registrar To
1. The Commercial Tax Officer-II, Rajapalayam.
2. The Additional Judicial Member, TamilNadu Sales Tax Appellate Tribunal (AB), Madurai.
3. The Appellate Assistant Commissioner (CT), Virudhunagar. +1 CC to M/s.S.KARUNAKAR, Advocate, SR No. 55697. +1 CC to THE SPECIAL GOVERNMENT PLEADER, SR No. 55856 SMN/SJ PSM/MMS/SAR3/26.05.2017/2P/6C ORDER MADE IN TAX CASE(MD)No.6 of 2011 04.05.2017 https://hcservices.ecourts.gov.in/hcservices/