effect of Supreme court judgement in bansal steel

[Dharmnath Avhad]

sir

Hon. Supreme court in the case of bansal steel held that stainless steel wire is not covered by section 14 of the central sales tax act .Therefore it will not declaredgoods to get covered under section 15 of the central sales tax act.Whether dealers shall wait for executive clarifications from central/state government or start collecting full rate of tax as general goods. I am surpised that nobody  is discussing this serious issue.

thanks

regards

adv. d b avhad

[YAGAY and SUN]

Dear Sir,

It's a Hon'ble Supreme Court's verdict and will have impact in 'rem'.  No need to further discussions on this matter.

[Dharmnath Avhad]

sir. I do not understand why there shall be no discussion on thjis topice. The supreme court judgment in Bansal wires( I wrote Steel)

will have far reaching impact. Dealer are lot confused as to wether they shall start collecting 12.5 o% on s s wires. What is the meaning of "rem".

regrads

d b avhad

[Ram Avtar Singh]

GOVERNMENT OF NeT OF DELHt

DEPARTMENT OF TRADE AND TAXES, (POUCY BRANCH)

VYAPAR BHAWAN, I.P. ESTATE, NEW DELHI-110002

No.F.3(217)/P-II/V AT/Misc./201

01

Dated: Oct., 2011

 CIRCULAR  No.13 .OF 2011-12

In a case titled M/s Bansal Wire Industries Ltd. and Anr. Vs State of UP and Ors., Hon’ble Supreme Court of India vide its judgment dated 26.04.2011 held that “Stainless Steel Wire” does not fall under the category of ‘tools, alloy and special steels’ in entry No. (ix) and, therefore, does not fall under “Iron and Steel” as defined under section 14(iv) of the Central Sales Tax Act.

Also, in the case of M/s Sharma Wire Industries, Commissioner, Value Added Tax, vide Order No. 41/CDVAT/2005 dated 20.10.2005 has determined that Steel Wire Ropes, Stainless Steel Ropes, Copper Wire Ropes and Copper Stay Wires are all taxable @ 12.5% as unscheduled goods u/s 4(1)(e) of the DVAT Act, 2004.

In the above context, it is hereby clarified that while determining taxability of such goods, the ratios of above referred judgment of Hon’ble Supreme Court of India and above quoted determination order shall be applicable.

This issues with the approval of the Commissioner, VAT.

G. C. Lohani)

VATO (Policy)

 

16 Oct, 2011

 0.F.3(217)/P-II/vAT/MiSC'/20101

 

71S -

Dated:

Copy forwarded for information and necessary action to:-

 1. PS to the Commissioner, VAT, Department of Trade and Taxes, GNCT of Delhi Vyapar Bhawan, I.P.Estate, New Delhi-02.

2. All Sp!.lAddUJoint Commissioners, Department of Trade and Taxes, GNCT of Delhi Vyapar Bhawan, I.P.Estate, New Delhi-02.

3. All VATOs/AVATOs Department of Trade and Taxes, GNCT of Delhi,  Jyapar Bhawan, I.P.Estate, New Delhi-O2

4.  AVATO(System), Department of Trade and Taxes, GNCT of Delhi,VyaparBhawan, I.P.Estate, New Delhi-02 for uploading the circular on the website of the department

 5.Dy. Director (R&S), Department of Trade and Taxes, GNCT of Delhi,Vyapar Bhawan, I.P.Estate, New Delhi-02.

6. The President, Sales Tax Bar Association (Regd.), IP.Estate, New Delhi.

Guard File.

 

Vyapar Bhawan,(Gcth~

VATO (Policy)

AI Summary

Tax classification of stainless steel wire: reclassified outside Iron and Steel and treated as general taxable goods under VAT guidance.
Supreme Court held stainless steel wire is not within the definition of Iron and Steel under section 14(iv) of the Central Sales Tax Act, removing it from that CST entry. The Delhi VAT policy branch issued a circular directing that the Court's ratio and an earlier VAT determination treating wire products as unscheduled goods be applied in assessing taxability of stainless steel wire, providing administrative guidance to departmental officers and dealers.