2023 (9) TMI 638 - HC - VAT and Sales Tax

Court Upholds Tax Liability on Wheat Bran Sale, Overturns Tribunal Decision

State of Odisha represented by Commissioner of Sales Tax, Odisha Versus M/s. K.K. Roller Flour Mills (P) Ltd.

State of Odisha represented by Commissioner of Sales Tax, Odisha Versus M/s. K.K. Roller Flour Mills (P) Ltd. - TMI Issues involved: Challenge to order u/s 24 of Odisha Sales Tax Act, 1947 read with Rule 52A of Odisha Sales Tax Rules, 1947 regarding taxation of wheat bran and interpretation of Entry 30-D in tax-free list.Summary:1. The First Appellate Authority partly allowed the appeal challenging the tax liability on the sale of bran, holding it taxable @ 4% based on a government notification. The appellant's claim for deduction was disallowed, and taxable turnover was re-determined. 2. The dealer filed an appeal against the First Appellate Authority's order, which was allowed by the Tribunal, setting aside the previous order and holding the sale of wheat bran as tax-free under Entry 30-D during the assessment year.3. The Tribunal reasoned that conditions restricting exemption should not defeat the purpose of the exemption, which aimed to benefit farmers by providing feed and fodder at an affordable price.4. The Revenue contended that the specific provision of taxing bran @ 4% prevailed over the general tax-free provision under Entry 30-D, citing relevant entries in the Odisha Sales Tax Act.5. The Court held that the subsequent amendment excluding bran from the tax exemption under Entry 30-D was clear and unambiguous, making bran taxable at 4%. The Tribunal's interpretation was deemed unwarranted, and the original order of the First Appellate Court was restored, quashing the Tribunal's order.6. The petition was allowed, and no costs were awarded. An urgent certified copy of the order was directed to be granted upon application.