Court quashes VAT assessment orders; surgical supplies not sales under the Act. Precedent upheld.

The Court quashed the temporary assessment orders for November and December 2015 under the U.P. VAT Act, holding that the use of stent, valves, and medicines during a surgical procedure does not amount to a sale under Section 2(ac) of the Act. The Deputy Commissioner's reliance on a different case was deemed erroneous as the Division Bench's precedent in International Hospital Private Limited remained binding. The Court emphasized adherence to established precedents and granted relief to the petitioner by allowing the writ petition.

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Issues:
Challenge to temporary assessment orders for November and December 2015 under U.P. VAT Act - Whether use of stent, valves, and medicines during surgical procedure amounts to sale within Section 2(ac) of the Act.

Analysis:
The writ petition challenged temporary assessment orders for November and December 2015 under the U.P. VAT Act, focusing on whether the use of stent, valves, and medicines during a surgical procedure constitutes a sale within Section 2(ac) of the Act. The Division Bench previously addressed a similar matter in International Hospital Private Limited vs. State of U.P., citing relevant precedents such as State of Madras v. Gannon Dankerley & Co. and Tata Main Hospital vs. State of Jharkhand. The Division Bench concluded that charges for drugs and consumables in the hospital bill do not transform the implantation of stents or valves into a sale under the Act.

The Deputy Commissioner, however, took a different view based on PRS Hospital and Aswini Hospital Pvt. Ltd. v. C.T.O. Thrissur without considering the Division Bench's decision in International Hospital. The Court noted that the Division Bench's ruling in International Hospital remains final, as no subsequent decision has overruled or discredited it. The Deputy Commissioner's decision to follow a distinguished case rather than the binding precedent of the Division Bench was deemed erroneous.

In light of the Division Bench's judgment in International Hospital Private Limited, the Court quashed the impugned orders from May 2016, emphasizing that their decision aligns with the established precedent. The Court clarified that their ruling does not present an independent opinion but upholds the Division Bench's findings, urging the assessing authority to consider all relevant factors for the final assessment of the year 2015-2016. Consequently, the writ petition was allowed, granting relief to the petitioner.

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