AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2023 (1) TMI 246
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....her on the facts and in the circumstances of the case, the Tribunal was legally justified to tax tyre, tube and flaps when sold along with tractor-trolley as a single unit to be taxed separately @ 12.5% and 13.5% and tractor-trolley without tyre, tube and flaps will be sold @ 4%? ii) Whether on the facts and in the circumstances of the case, the dispute being the rate of tax the confirmation of penalty by the Tribunal is correct in law? iii) Whether on the facts and in the circumstances of the case, the Tribunal was legally correct in confirming the imposition of maximum penalty by the assessing officer without taking into consideration the decisions relied on by the petitioner rendered in the case of Union of India Vrs. Rajasthan Spinning & Weaving Mills reported in (2010) 1 GSTR 66 (SC) = 2009 (238) ELT 3 (SC), which has been relied on by the Hon'ble Supreme Court in the case of Commissioner of Central Excise, Chandigarh Vrs. Pepsi Foods Ltd. reported in 2010 (260) ELT 481 (SC)?" 1.1. Since questions of law raised in both these revision petitions are similar, they are heard analogously and disposed of by this common Judgment. Facts of Maa Santoshi Engineering: 2. Audit Ass....
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....@ 12.5% as unspecified goods. The statute in Sl. No.119 above has neither imposed nor pressed upon any conditions that the rate in the Sl. No. be applicable to traders and not to manufacturers when he sells his finished products. In the event of clarity in law in our considered opinion tractor-trailers are to be taxed @ 4% but not tyres, tubes and flaps etc. These goods (tyres, tubes, flaps) are to be taxed @ 12.5% in the tax rate schedule C of the OVAT Act." 2.3. Against this Order of the learned Tribunal the petitioner-dealer has approached this Court in revision invoking provisions under Section 80 for adjudication of questions of law as posed supra. Facts of R.K. Engineering: 3. Audit Assessment was framed under Section 42 of the OVAT Act by the learned Sales Tax Officer, Kalahandi Circle, Bhawanipatna pertaining to the tax periods from 15.01.2009 to 30.06.2011 raising a demand to the tune of Rs.5,28,215/- [Tax =Rs.1,76,072/- + Penalty = Rs.3,52,143/-] vide Order dated 11.02.2013 by holding that the tyres and tubes of tractor-trolley manufactured by the petitioner is subject to tax @ 12.5% [for the tax period upto 31.03.2011] and @ 13.5% after 01.04.2011 as per Part-III of S....
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....re excluded from the words "Tractors, threshers, harvesters and attachments and parts thereof" used in the said entry. It is stated in Deepak Agro Solution Ltd. Vrs. Commissioner of Customs, (2008) 8 SCC 358 that what is not excluded would be held to be included. In CCE Vrs. Shree Baidyanath Ayurved Bhawan Ltd., (2010) 1 GSTR 1 (SC) it is laid down that specific entry must prevail over a general entry. This Court in State of Odisha Vrs. Bharat Store, (2002) 127 STC 333 (Ori) held that it is a settled position of law that a taxing statute is to be strictly construed and the words used are to be given their natural meaning. It is also the settled position that entries in the Schedule are to be interpreted in their popular sense unless they are expressly defined in the enactment. 6.2. In Raj Brothers Agencies Vrs. State of TN, (1977) 39 STC 191 (Mad) it has been stated that a special entry overrides a general provision. If main article to which the item in question is accessory or component part is taken out of that item, its accessories and component parts could not be said to have been left untouched. Though batteries may be electrical goods and battery plates are accessories or co....
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....t is apparent that component parts of tractor and its trailer were considered separate from tyres and tubes of tractor and its trailer, while carving out from sl. 2 automobile tyres and tubes as in Sl.5 with effect from September 1, 1978 and from Sl.4 component parts of tractor and its trailer as in Sl. 6 with effect from June 1, 1980. Consequently, the argument of the learned counsel for the dealer that tractor tyres and tubes are taxable as component parts of tractor is without any substance." (Emphasis supplied). 6.6. This Court while dealing with whether "flap" is "component part of motor vehicle" in the case of State of Odisha Vrs. Dunlop India Ltd., (1993) 90 STC 379 (Ori) observed as follows: "3. *** As the user of the flap being limited for the purpose indicated above, it cannot be said to be a component part of tyres and tubes. It is also not an accessory to tyres and tubes in view of the test laid down by the Apex Court in the case of M/s. Mehera Brothers v. The Joint Commercial Officer, Madras, AIR 1981 SC 1017. The Court has observed in paragraph 5 of the judgment that the correct test would be whether an article or articles in question would be an adjunct or an acc....
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....rji, J., as he then was, while considering the submission that it was only the goods as specified in the schedule to the Act that could be subjected to the duty in para 6 observed: (SCC p. 607, para 6) 'For articles to be goods these must be known in the market as such or these must be capable of being sold in the market as goods. Actual sale in the market is not necessary, user in the captive consumption is not determinative but the articles must be capable of being sold in the market or known in the market as goods. That was necessary.' The appellants themselves have called the goods 'Tie Bar Nuts' and those are admittedly used for fixing platens at appropriate distances. It cannot be said that the Tie Bar Nuts after their manufacture did not constitute goods; their actual sale in the market was not necessary. *** 16. In the instant case there is no dispute that Tie Bar Nuts conform to the popular idea of nuts. In Indo International Industries Vrs. CST, (1981) 2 SCC 528 this Court observed that in interpreting items in statutes like the Excise Act or Sales Tax Act, whose primary object was to raise revenue and for which purpose to classify diverse products, articles and s....
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....- dealer. In the OVAT Act, various Sections provide for imposition of penalty for infraction of statutory provisions. In most of those Sections opportunity of being heard is provided to a dealer before imposition of penalty. Those Sections are Section 28(1), Section 31(9), Section 34(3), Section 54(6), Section 61(5), Section 62(6), 65(2), Section 73(10), Section 73(12)(e), Section 73(13), Section 76(3), Section 76(8), Section 101(4) and Section 107(4). The present position is entirely different. Quantification of penalty is dependant on the tax assessed under Section 42 of the OVAT Act. For the purpose of assessing tax, opportunity of hearing was afforded to the assessee, the explanation of the assessee and its books of account were examined and considered. Penalty is only quantified on the basis of the tax assessed. No discretion is left with the Assessing Officer for levying any lesser amount of penalty. Therefore, even if further opportunity will be given to the assessee before imposing penalty that will be a futile exercise. Penalty is not independent of the tax assessed. If the tax is assessed, imposition of penalty under 42(5) is warranted. *** 35. In view of the abov....
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....ice in the form and manner prescribed along with a copy of the Audit Visit Report, requiring him to appear in person or through his authorized representative on a date and place specified therein and produce or cause to be produced such books of account and documents relying on which he intends to rebut the findings and estimated loss of revenue in respect of any tax period or periods as determined on such audit and incorporated in the Audit Visit Report. (2) Where a notice is issued to a dealer under sub-section (1), he shall be allowed time for a period of not less than thirty days for production of relevant books of account and documents. (3) If the dealer fails to appear or cause appearance, or fails to produce or cause production of the books of account and documents as required under sub-section (1), the assessing authority may proceed to complete the assessment to the best of his judgment basing on the materials available in the Audit Visit Report and such other materials as may be available and after causing such enquiry as he deems necessary. (4) Where the dealer to whom a notice is issued under sub-section (1), produces the books of account and other documents, the ....
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....ettled principle of law in the matter of applying precedents that the Court should not place reliance on decisions without discussing as to how the fact situation of the case before it fits in with the fact situation of the decision on which reliance is placed. The observations of the courts are neither to be read as Euclid's theorems nor as provisions of statute and that too taken out of their context. These observations must be read in the context in which they appear to have been stated. Disposal of cases by blindly placing reliance on a decision is not proper because one additional or different fact may make a world of difference between conclusions in two cases. [Ref. Bharat Petroleum Corpn. Ltd. Vrs. N.R. Vairamani, (2004) 8 SCC 579; Sarva Shramik Sanghatana (KV) Vrs. State of Maharashtra, (2008) 1 SCC 494 and Bhuwalka Steel Industries Ltd. Vrs. Bombay Iron & Steel Labour Board, (2010) 2 SCC 273]." 7.3. This Court, as regards applicability of Rajasthan Spinning & Weaving Mills (supra), in the case of Jai Jagannath Marble Vrs. Commissioner of Commercial Taxes, (2011) 39 VST 312 (Ori) held as follows: "11. In this respect, reliance was placed by the Revenue on the decisi....