TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
When case Id is present, search is done only for this
of 
of 
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of of 
All Case Laws
of of All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of <h1>Court Upholds Tax on Tractor Parts as Accessories, Not Essential Attachments</h1> <h3>M/s Ajeet Iron Stores Ashok Nagar, M/s Moolchand Gendalal, Ashok Nagar Versus The Commissioner, Commr. Tax & Anr.</h3> M/s Ajeet Iron Stores Ashok Nagar, M/s Moolchand Gendalal, Ashok Nagar Versus The Commissioner, Commr. Tax & Anr. - TMI Issues:Levy of tax on 'tractor hood' and 'front bumper' as accessories under VAT Act.Analysis:The judgment concerns appeals under Section 53 of the Madhya Pradesh Value Added Tax Act, 2002, challenging an order by the Commercial Tax Appellate Board regarding the levy of tax on specific parts treated as accessories under the Act. The dispute revolves around whether the 'tractor hood' and 'front bumper' should be taxed at 13% as accessories or at 5% when sold with the tractor. The appellants argue that the parts should be considered inseparable from the tractor and taxed at the lower rate.The crux of the issue lies in the interpretation of Entry No.90 in Part II of Schedule II of the Act, which specifies the tax rate for tractors and their attachments and parts. The appellants contend that since the parts in question are attachments of the tractor, they fall under Entry No.90, attracting a tax rate of 5%. They argue that the specific entry prevails over the general residual entry in Part IV, which applies a 13% tax rate to goods not covered elsewhere.The judgment delves into the distinction between 'attachments' and 'accessories' under the Act. It highlights that the inclusion of the term 'accessories' in Entry No.90 from 01.04.2015 altered the tax treatment, emphasizing that accessories are secondary and non-essential items. Citing legal precedents, the court emphasizes that the predominant or ordinary purpose of an item determines its categorization. In this context, the court analyzes the essential nature of bumpers and hoods for the functioning of tractors.Drawing on case law, including 'Union of India v. Garware Nylons Ltd.' and 'Pragati Silicons (P) Ltd. v. Commissioner of Central Excise,' the judgment underscores that accessories need not be essential for the functioning of the product. Applying this principle to the case at hand, the court upholds the classification of bumpers and hoods as non-essential attachments, affirming the decision of the Assessing Authority and the Tribunal.Ultimately, the court dismisses the appeals, ruling that no substantial question of law necessitates further consideration. The judgment concludes that the tax treatment of the tractor parts as accessories at 13% is appropriate, and the appeals are thus rejected without costs.
TaxTMI 