Residuary tax entry applied where moulds and dies could not qualify as capital goods without in-State use.

In the absence of C Forms, inter-State sales tax on moulds and dies had to be determined by reference to the Tamil Nadu VAT Act's charging structure. Section 8(2) of the CST Act applies the State rate where the sale is not covered by section 8(1), but the capital goods definition in section 2(11) of the Tamil Nadu VAT Act requires specified categories of goods and use within the State for manufacture, processing, packing or storing. As that in-State use requirement was not satisfied on the admitted facts, the goods could not be treated as capital goods. The residuary entry in Entry 69 of Part-C of the First Schedule applied, and the impugned order was upheld.

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Issues: Whether, in the absence of C Forms, the tax on inter-State sales of moulds and dies had to be determined by treating the goods as capital goods under the Tamil Nadu Value Added Tax Act, 2006, or by applying the residuary entry in Part-C of the First Schedule to that Act.

Analysis: Section 8(2) of the Central Sales Tax Act, 1956 requires the tax on inter-State sales not covered by section 8(1) to be charged at the rate applicable to the sale or purchase of such goods inside the appropriate State. Section 2(11) of the Tamil Nadu Value Added Tax Act, 2006 defines capital goods by listing specific categories of goods and also requires that they be used in the State for the purpose of manufacture, processing, packing or storing of goods. The stated condition of use within the State was not satisfied on the admitted facts, and no other specific entry in the Schedule was shown to apply.

Conclusion: The goods could not be treated as capital goods for the applicable State rate, and the residuary entry in Entry 69 of Part-C of the First Schedule to the Tamil Nadu Value Added Tax Act, 2006 applied. The impugned order was upheld.

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