2024 (10) TMI 500

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....he sale of retread rubber, pertaining to the assessment years 2011-12 and 2013-14 under the Kerala Value Added Tax Act, they are taken up together for consideration and disposed by this common order. 2. The Revision Petitions have been preferred by the State impugning orders of the Kerala Value Added Tax Appellate Tribunal that find that the rate of tax applicable on the sale of retread rubber that was used for the execution of a works contract should be @ 5% as contended by the assessee as against 12.5% / 14.5% as claimed by the Revenue. The assessee was engaged in retreading of tyre by using tread rubber manufactured by it for the purposes of resoling the tyres handed over to it by various customers. In essence, while carrying out the ....

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...., in as much as the transfer of the goods was in the form of goods and not in some other form, it is the normal rate of tax applicable to the goods [5% ad valorem] that would apply. 5. The Assessing Authority and the First Appellate Authority rejected the contention of the assessee by holding that the transfer of goods in the course of execution of the works contract was not in the form of goods but in some other form since the tread rubber strips used by the assessee had been fused into the old tyres that were brought by the customers and the goods manufactured by the assessee had lost their identity as those goods during the process of the works contract. The Appellate Tribunal, on the other hand, accepted the plea of the assessee and ....

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....Muraleedharan Nair, the learned counsel for the respondent/assessee would place emphasis on the latter order dated 29.1.2020 to contend that in the light of newer technologies available, the stand taken by this Court has now to be that the transfer of retread rubber in the course of retreading works is to be seen as a transfer of goods in the form of goods and not in some other form and therefore the Tribunal's view of upholding the rate of tax @ 5% had to be accepted. 8. Per contra, Smt.Resmitha Ramachandran, the learned Government Pleader, would invite our attention to the order dated 29.1.2020 of the authority for clarification to point out that the changed interpretation by the Department came about only because of newer technolo....