TaxTMI 
TaxTMI 
2009 (1) TMI 803
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....th reference to the common order of the Tribunal and orders of the lower authorities produced in ST Rev. No. 17 of 2008, which pertains to sales tax assessment for the year 1983-84. We have heard senior counsel Sri Arshad Hidayathullah appearing for the petitioner and Special Government Pleader Sri Vinod Chandran appearing for the respondent. The assessee is a plantation company which maintains multicrop plantations, namely, coffee, tea and rubber. Rubber trees start yielding after six to seven years of planting and the economic life of the rubber trees is 20 to 25 years. When the yield is reduced rubber trees are subject to slaughter tapping and sold and replantation is raised in the land. It is seen from the impugned orders that the assessee has extensive area of plantation and invariably every year the assessee sells old trees and raises fresh plantation in such area. For assessment year 1983-84, the assessee sold old rubber trees for Rs. 18,06,680. In the sales tax returns the assessee did not concede the sale price as taxable turnover under the Kerala General Sales Tax Act, 1963, hereinafter called the "Act". However, when the assessing officer proposed to assess the turnov....
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.... sales tax. Even though senior counsel appearing for the assessee contended that the Supreme Court in the judgment in appeal does not mention about this and so much so, the Tribunal was not entitled to go into the question, Special Government Pleader referred to the third issue referred to in the judgment of the Supreme Court and contended that the Tribunal is bound to decide the legality and correctness of the assessment order and this issue therefore has to be necessarily decided by the Tribunal. We are in agreement with the argument of the Special Government Pleader because the basic claim of the assessee which is found in the assessment order itself is that it is entitled to exemption on sale of old standing rubber trees, because it is an "agricultural produce" which is excluded from the definition of "turnover" contained in section 2(xxvii) of the Act. On going through definition clauses of "sale", "goods", "dealer" and "turnover" and the charging section contained in the Act we notice that all goods whether produced by agriculture, manufacture or otherwise, are subject to tax, except when it is covered by exemption clause contained in the provisions of the Act or by virtue of....
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....ision of this court in the earlier round vide decision in Tropical Plantations Ltd. v. State of Kerala [2001] 9 KTR 68, the Special Government Pleader appearing for the respondent contended that the judgment of this court was against the petitioner, though not on this issue and this court has not considered the matter in detail. He further submitted that after the Supreme Court set aside the said judgment of this court, the petitioner cannot rely on the very same judgment on this issue. On going through the judgment we find that this court has disposed of the issue in the following lines: "We do not agree with the reasoning given by the Tribunal based on the decision of the Supreme Court in State of Orissa v. Titaghur Paper Mills Co. Ltd. reported in [1985] 60 STC 213. There the question was whether the sale of tree should be treated as capital receipt and not taxable as agricultural income." From the above, we do not think this court has considered or decided the issue in the correct perspective. On the other hand, since they otherwise found the petitioner ineligible for exemption, they did not consider the question in detail at all. They have not considered as to what is th....
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....me Court the income obtained on sale of the tree is capital receipt. Therefore the petitioner's main contention that old and unyielding rubber trees is "agricultural produce" entitled to exemption from turnover under section 2(xxvii) of the Act is untenable and the same is rejected. The next question to be answered based on the decision of the Supreme Court is whether sale of standing rubber trees under contract of cutting and removal amounts to sale of goods. "Goods" as defined under section 2(xii) include among other things all growing crops, grass or things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale. Further, Explanation 1 to section 2(xxi) states that transfer of the property in the following goods namely, tea, coffee, rubber, cardamom or timber, whether in the course of trade or business or otherwise, for cash or for deferred payment or other valuable consideration, by a person who produces the same, shall be deemed to be sale for the purposes of this Act. Again Explanation (1B) states that a transfer of property in trees which grow spontaneously and which are agreed to be severed before sale o....