2011 (2) TMI 1338 - HC - VAT and Sales Tax

Court sets aside assessment order, rules in favor of petitioners on taxation classification issue.

The court allowed the writ petition, setting aside the assessment order and demand notice issued by the Revenue. The decision was based on the analysis of ... Assessment of taxes on aluminium plain sheet at eight per cent as unclassified item instead of four per cent tax as already deposited by the petitioners-assessee treating the same to be covered by entry 45(b) of the Second Schedule Held that:- aving regard to the successive notification prescribing the situs of aluminium plain sheets and in absence of any overwhelming evidence that the same on the basis of the inputs available can be decisively held to be a finished product emanating from the primary metal aluminium, this court is of the view that for the intervening period February 1, 2000 to February 18, 2002 it ought to be regarded as included in entry 45(b) of Schedule II and taxable at four per cent. Following the decision rendered by this court in Steel Stores [2010 (6) TMI 720 - GAUHATI HIGH COURT] the impugned assessment order dated December 28, 2003 (annexure I to the writ petition) and the impugned demand notice dated February 17, 2003 (annexure J to the writ petition) issued by the Revenue, Senior Superintendent of Taxes, Unit A, Guwahati, respondent No. 2, are hereby set aside and quashed. In favour of assessee. Issues:Challenge to assessment order and demand notice regarding taxation on aluminium plain sheet at different rates.Analysis:The writ petition challenged the assessment order and demand notice issued by the Revenue regarding the taxation on aluminium plain sheets at eight percent instead of the four percent already deposited by the petitioners. The petitioners contended that the assessment was incorrect and referred to a previous judgment by the court in a similar case to support their argument. The court analyzed the previous judgment extensively, highlighting the distinction between aluminium plain sheets and corrugated sheets in terms of taxation. The court noted the deficiency in legislation regarding the classification of aluminium plain sheets and concluded that for the relevant period, these sheets should have been taxed at four percent under a specific entry. The court found the decision of the revisional authority to be unsustainable in law and facts.The Revenue, represented by its standing counsel, conceded to the submissions made by the petitioners' counsel, as the standing counsel himself had argued in the previous case cited by the petitioners. After hearing both parties and considering the previous judgment, the court determined that the current case was fully covered by the earlier decision. Consequently, the court allowed the writ petition in line with the judgment passed in the previous case, setting aside the impugned assessment order and demand notice issued by the Revenue.In conclusion, the court allowed the writ petition, setting aside the assessment order and demand notice issued by the Revenue. The court's decision was based on the analysis of the previous judgment that highlighted the taxation classification of aluminium plain sheets and the deficiency in legislation regarding their classification. The court's ruling was in favor of the petitioners, as the case was deemed to be fully covered by the precedent set in the earlier judgment.