2022 (8) TMI 415 - HC - VAT / Sales Tax

Aluminum extrusions don't qualify as 'sheets, rods etc.' under Entry 11, exempting them from 1% entry tax

M/s. Glamour, Cuttack Versus State of Odisha, represented by the Commissioner of Sales Tax, Cuttack

M/s. Glamour, Cuttack Versus State of Odisha, represented by the Commissioner of Sales Tax, Cuttack - TMI Issues:1. Interpretation of Entry 11 of Part-I of the Schedule to the Orissa Entry Tax Act, 1999.2. Justification of penalty under Section 7(5) of the OET Act.Interpretation of Entry 11:The case involved a dispute regarding the liability to pay entry tax on Aluminum extrusions under Entry 11 of the Schedule to the Orissa Entry Tax Act, 1999. The Tribunal had held that Aluminum extrusions were amenable to tax at 1%, rejecting the Assessee's contention that no entry tax was payable on goods not mentioned in the Schedule. The High Court analyzed the legislative intent behind the wording of Entry 11, focusing on the use of the term 'etc.' The Court emphasized the principle of strict interpretation in taxation law and referred to precedents emphasizing the understanding of terms in trade and commerce. The Court concluded that Aluminum extrusions did not fall under Entry 11 as they were distinct from 'sheets' and 'rods' mentioned in the entry, ultimately ruling in favor of the Assessee.Justification of Penalty:The Court also addressed the issue of the Tribunal upholding the levy of penalty under Section 7(5) of the OET Act. Given the ruling on the interpretation of Entry 11, the Court held that the Tribunal was not justified in imposing the penalty. The Court's decision on the first issue influenced the outcome of the penalty issue, leading to a negative answer regarding the justification of the penalty under Section 7(5) of the OET Act. Consequently, the impugned orders of the Tribunal, Sales Tax Officer, and Assistant Commissioner of Sales Tax were set aside, and the petition was disposed of in favor of the Assessee.