TaxTMI 
TaxTMI 
2011 (2) TMI 1110
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....that the Assessee has received payments on account of sale of scrap. The Assessee Company had not collected tax (TCS) at the time of receipt of the sale proceeds or at the time of debiting the account of the purchasers. The AO, therefore, issued a show cause notice as to why the tax be not raised Under Section 206C(6) and interest Under Section 206C (7). The Assessee replied that the scrap sold was plastic, M. S. & G. I. drums, wooden scrap, plastic material, used oil, electrical cables etc. It was stated as per definition of Scrap in Explanation (b) to Section 206C, the scrap should be such waste or scrap which arises from manufacturing or mechanical working of material. It was stated by the Assessee that the nature of scrap generated in the Assessee's premises did not arise from manufacturing of product dealt by the company and, therefore, the provisions of Section 206C were not attracted. The AO did not accept the above explanation. The details of scrap sold show that it consisted of various things, such as, packing material, oil, electrical items, etc. The list of scrap is as under: a) M.S./G,I. drums -first b) M.S./G.I. drums -second c) Plastic D....
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....e percent TCS is required to be collected by the Assessee. The definition of scrap as stated by the Appellant and the AO is also very clear, which includes any scrap which cannot be used directly for manufacturing purpose by the purchaser and which has been generated from the manufacture of mechanical work of materials. The list of items given above clearly shows that the same has been generated by the Assessee company. The Assessee company is only engaged in the manufacturing of fluorine and other refrigerant gases. Hence, the entire scrap has been generated out of its manufacturing activity. Therefore, the provisions of Section 206C are attracted. The fact that this scrap is not directly used for manufacture is further clear as the Assessee has not obtained declaration as provided under Rule 37C in the Form No. 27C. Hence, the action of the AO is confirmed 3. In the result, the appeal is dismissed. 6. We have heard the learned representatives of both the parties 7. The learned Counsel for the Assessee reiterated the and perused the findings of the authorities below. Submission made before the authorities below and submitted that ITA No. 1213 and 1214/Ahd/2010 Navin....
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....such amount from the said buyer in cash or by the issue of a cheque or draft or by any other mode, whichever is earlier, collect from the buyer of any goods of the nature specified in column (2) of the Table below, a sum equal to the percentage, specified in the corresponding entry in column (3) of the said Table, of such amount as income-tax TABLE Sl. No. Nature of goods Percentage (1) (2) (3) (i) Alcoholic Liquor for human consumption One per cent (ii) Tendu leaves Five per cent (iii) Timber obtained under a forest lease Two and one-half per cent (iv) Timber obtained by any mode other than under a forest lease Two and one- half per cent (v) Any other forest produce not being timber or tendu leaves Two and one- half per cent (vi) Scrap One per cent:] [Provided that every person, being a seller shall at the time, during the period beginning on the 1st day of June, 2003 and ending on the day immediately preceding the date on which the Taxation Laws (Amendment) Act, 2003 comes into force, of debiting of the amount payable by the buyer to the account of the buyer or of receipt of such amount from....
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....1) (2) (3) (i) Parking lot Two per cent (ii) Toll plaza Two per cent (iii) Mining and quarrying Two per cent.] [Explanation 1.-For the purposes of this Sub-section, "mining and quarrying" shall not include mining and quarrying of mineral oil. Explanation 2.-For the purposes of Explanation 1, "mineral oil" includes petroleum and natural gas.] (2) The power to recover tax by collection under Sub-section (1) [or Sub-section (1C)] shall be without prejudice to any other mode of recovery. (6) Any person responsible for collecting the tax who fails to collect the tax in accordance with the provisions of this section, shall, notwithstanding such failure, be liable to pay the tax to the credit of the Central Government in accordance with the provisions of Sub-section (3). [(6A) If any person responsible for collecting tax in accordance with the provisions of this section does not collect the whole or any part of the tax or after collecting, fails to pay the tax as required by or under this Act, he shall, without prejudice to any other consequences which he may incur, be deemed to be an Assessee in default in resp....
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....e as being inapposite surpluses, if they can have a proper application in circumstances conceivable within the contemplation of the statute. 10.1 By following the above decision, the Hon'ble High Court held as under: It is now a well settled principle of law that a literal meaning should be attributed to a statute. The golden rule of interpretation should ordinarily be adhered to. 11. The ordinary meaning of scrap and waste as have been provided in Oxford English Dictionary provides (a) Scrap -Small piece or amount of something especially one that is leftover after greater part has been used - material discarded for reprocessing. (b) Waste -eliminated or discarded as no longer useful or required. 11.1 The ordinary meaning of scrap and waste thus has a similarity in words. Ordinarily, the word "AND" is used in a conjunctive sense. This word is used to connect clauses or sentences or to coordinate words in the same clauses. 12. The explanation to Section 206C of the IT Act provides the meaning of scrap means "waste and scrap" from manufacture or mechanical working of material which is definitely not usable as such because of breakage, cuttin....