2025 (9) TMI 1399 - HC - VAT / Sales Tax

DEPB is taxable as intangible marketable goods under Schedule Entry C-I-26(6); exemption under Notification Entry A-94 denied

HC upheld that a Duty Entitlement Pass Book (DEPB) qualifies as intangible marketable goods and is taxable under Schedule Entry C-I-26(6), following SC ... Levy of tax under Schedule Entry C-I-26(6) appended to the Bombay Sales Tax Act, 1959 - Credit of Duty Entitlement Pass Book is intangible marketable goods or not - availability of benefit of Notification Entry A-94 issued under section 41 of the Bombay Sales Tax Act, 1959. Whether on the facts and in the circumstances of the case, the Tribunal was right in holding that “Credit of Duty Entitlement Pass Book” is intangible marketable goods and is liable to tax under Schedule Entry C-I-26(6) appended to the Bombay Sales Tax Act, 1959? - HELD THAT:- The issue is covered by the decision of the Hon’ble Supreme Court in the case of Yasha Overseas V/s. Commissioner of Sales Tax And Ors [2008 (5) TMI 43 - SUPREME COURT]. In the said case, the Hon’ble Supreme Court has held that the DEPB License (Duty Entitlement Pass Book) like an REP Licence (Replinishment Licence) qualifies as goods having an intrinsic value that makes it a market commodity. Therefore, such licence which qualifies as ‘goods’ within the meaning of the Sales Tax Laws of Delhi, Kerala and Mumbai its sale is exigible to tax - the question is answered in favour of the Revenue and against the Assessee by following the decision of the Hon’ble Supreme Court in Yasha Overseas. Whether on the facts and in the circumstances of the case in Second Appeal No. 985 of 2003, the Tribunal was right in holding that benefit of Notification Entry A-94 issued under section 41 of the Bombay Sales Tax Act, 1959 is not available to the appellant? - HELD THAT:- Reference made to the Tribunal’s Judgment and Order dated 21 March 2006 in Second Appeal No. 985 of 2003, from which this Reference arises. Therein, the Tribunal has not doubted the applicability of the Notification Entry A-94 issued under Section 41 of the Bombay Sales Tax Act, 1959. However, the Tribunal has held that the Applicant failed to produce necessary documentary evidence regards fulfilling the conditions for availing the exemption under the said notification. In the absence of evidence, the Tribunal found it difficult to allow the Applicant’s claim for exemption. The above question, strictly speaking, does not raise any question of law. It is more a question of fact as to whether the conditions prescribed under the Notification were fulfilled by the Applicant. In the absence of any documentary evidence being produced by the Applicant in this regard, neither the approach of the Tribunal can be faulted nor the second question is answered in favour of the Assessee - even the second question is answered against the Assessee and in favour of the Revenue. The References are disposed of. Two Sales Tax References presenting identical questions were disposed of together. The first question-whether 'Credit of Duty Entitlement Pass Book' is intangible marketable goods liable to tax under Schedule Entry C-I-26(6) of the Bombay Sales Tax Act, 1959-was decided by following the Supreme Court in Yasha Overseas v. Commissioner of Sales Tax, which held that the DEPB license, like an REP licence, 'qualifies as goods having an intrinsic value that makes it a market commodity,' and therefore its sale is exigible to tax. The second question-whether the benefit of Notification Entry A-94 under section 41 was available-was treated as a question of fact: the Tribunal accepted the notification's applicability but found the appellant did not produce necessary documentary evidence to show fulfilment of the notification's conditions. In the absence of evidence, the Tribunal's refusal to allow the exemption is sustained. Both questions were answered against the assessee and in favour of the revenue; references disposed of without costs.