TaxTMI 
TaxTMI 
TaxTMI 
2022 (9) TMI 386
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....ion 25(1) of the Goa Tax on Entry of Goods Act, 2000 (Entry Tax Act). 3. The Petitioners amended this petition, among other things seeking a declaration that the State and its authorities were not competent to levy entry tax on imported goods. The Petitioners also sought a refund of entry tax paid by them under protest regarding imported goods under item 9 of the notification dated 19.05.2003 referred above. 4. Mr Usgaonkar, however, made it clear that the Petitioners were not pressing the contention about the competence of the State and its authorities to levy entry tax on imported goods given the decision of the Hon'ble Supreme Court in the State of Kerala and others Vs Fr. William Fernandez and others (2021) 11 SCC 705. In this case, the Hon'ble Supreme Court has held that the import of goods from any territory outside India ends when the goods enter the customs frontiers of India and are released for home consumption. After the import of goods ends, the State Legislature has complete legislative competence to levy entry tax under Entry 52, the Seventh Schedule to the Constitution of India. The Court held that the original package theory developed by the American Supre....
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....ver, even Respondent No.2 vide impugned order dated 05.01.2006 only endorsed the order dated 11.08.2005. Hence, the present petition. 10. Mr Usgaonkar submitted that item 9 of the notification dated 19.05.2003 refers to the Export Promotion Capital Goods (EPCG) Scheme in express terms. This scheme refers explicitly to the import of motor cars by hotels. Based on this, he submits that the Petitioners are entitled to the benefit of concessional rates under notification dated 19.05.2003. 11. Mr Usgaonkar submits that the Respondents exceeded their jurisdiction by referring to the definition of "capital goods" under Section 2(f) of the Goa Value Added Tax Act, 2005. He submits that the provisions of the 2005 Act were not at all applicable. In any case, the definition clause specifies that the definition would apply "unless the context otherwise requires". He relied on the Vanguard Fire and General Insurance Co. Ltd., Madras Vs M/s Fraser and Ross and another [AIR 1960 SC 971] to explain the meaning of italicized portion. 12. Mr Usgaonkar submitted that the exemption/concession notification dated 19.05.2003, referring to the EPCG scheme makes it clear that the benefit of the concessi....
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....ere entitled to refer to the definition of 'capital goods' in Section 2(f) of the VAT Act, 2005, given the provisions in Section 2(B) of the Entry Tax Act. He also referred to the requirements of the Goa, Daman and Diu General Clauses Act, 1965, read with Section 8 of the General Clauses Act, 1897, in support of this contention. 18. Based on the above contention, the learned Advocate General submitted that this petition may be dismissed with costs. 19. The rival contentions now fall for our determination. 20. The primary issue in this petition is the interpretation of the exemption notification dated 19.05.2003, which entitles an importer to pay entry tax at reduced rates prescribed therein. The State Government has issued this notification under Section 25(1) of the Entry Tax Act, which empowers exemption or tax reduction in circumstances to be specified. 21. There is no dispute that the notification dated 19.05.2003 is an exemption notification exempting tax payments at full rates. Therefore, at the very outset, it is necessary to advert to some precedents on the interpretation of exemption notifications under a taxing statute. 22. In State of Maharashtra v. S....
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....g statute must be construed in his favour, for an exception or exemption provision must be construed strictly. 26. In Giridhar G. Yadalam v. CWT - (2015) 17 SCC 664, the Hon'ble Supreme Court has held that in a taxing statute, it is the plain language of the provision that has to be preferred where language is plain and is capable of one definite meaning. It is further held that the strict interpretation of the exemption provision is to be accorded. The purposive interpretation can be given only when there is some ambiguity in the language of the statutory provision, or if it leads to absurd results. 27. In Krishi Upaj Mandi Samiti (supra), the Hon'ble Supreme Court has held that it is settled law that the notification has to be read as a whole. If any of the conditions laid down in the notification is not fulfilled, the party is not entitled to the benefit of that notification. An exception and/or an exempting provision in a taxing statute should be construed strictly. It is not open to the Court to ignore the conditions prescribed in the relevant policy and the exemption notifications issued. The exemption notification should be strictly construed and defined according ....
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.... under Export Promotion Capital Goods Scheme. In excess of one paisa in every ten rupees. (i) The claiming unit should produce a certificate from the competent authority stating that it is covered under Export Promotion Capital Goods Scheme. (ii) The goods imported should be actually installed within the State of Goa. 10 ............... ......... ......... 30. Similarly, clause 5.1 of the EPCG scheme is also transcribed below for the convenience of reference. "5.1 EPCG Scheme. The scheme allows import of capital goods for pre production, production and post production (including CKD/SKD thereof as well as computer software systems) at 5% Customs duty subject to an export obligation equivalent to 8 times of duty saved on capital goods imported under EPCG scheme to be fulfilled over a period of 8 years reckoned from the date of issuance of licence. 1[However, in respect of EPCG licences with a duty saved value of Rs.100 crore or more the same export obligation shall be required to be fulfilled over a period of 12 years ] The capital goods shall include spares, jigs, fixtures, dies and moulds EPCG licence may also be issued for import of components of such capi....
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....assigned to in the Goa Sales Tax Act, 1963. After that, in the year 2013, for the expression "Goa Sales Tax Act, 1964 (Act 4 of 1964)", the expression "the Goa Value Added Tax Act, 2005 (Goa Act 9 of 2005)" was substituted. 34. Now even if we were to ignore the amendment of 2013, there was nothing wrong with the Respondents referring to the definition of "capital goods" in Section 2(f) of the Goa Value Added Tax Act, 2005. At the stage when the Petitioners insisted upon the benefit under the notification dated 19.05.2003, the Goa Sales Tax Act, 1964, was already repealed and replaced with the Goa Value Added Tax Act, 2005. In this regard, we can usefully be referred to the provisions of the Goa, Daman and Diu General Clauses Act, 1965, in terms of which provisions of Section 8 of the General Clauses Act, 1897, will apply to the interpretation of the Entry Tax Act. 35. Section 8 of the General Clauses Act, among other things, provides that where this Act or any Central Act or Regulation made after the commencement of this Act repeals and re-enacts, with or without modification, any provision of a former enactment, then references in any other enactment or in any instrument to the ....
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....crimination and consequent violation of Article 14 of the Constitution is quite misconceived. In terms of Section 25 of the Entry Tax Act, it is for the State Government to determine any specified class or persons or class of dealers or any goods or class of goods that can be exempted from payment of entry tax or qualify to pay reduced entry tax. Section 25 of the Entry Tax Act is only an enabling provision. 40. There is no mandate to provide for an exemption or to reduce tax. Thus, if the State Government believed that it was necessary in the public interest to grant exemption or decrease the rate of entry tax only to capital goods brought or caused to be brought or delivered into a local area by or to units covered under the EPCG scheme, there is no question of any unreasonable classification or discrimination involved. As noted earlier, the exemption notification applies only to capital goods brought by or to units covered under the EPCG scheme. Nothing in the exemption notification refers to the coverage of all goods that might be referred to in clause 5.1 of the EPCG scheme. 41. Incidentally, on the date of issue of exemption notification on 19.05.2003, the EPCG scheme did n....