TaxTMI 
TaxTMI 
2024 (11) TMI 1277
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....959 (in short 'TNGST Act'). 2. The petitioner is a manufacturer and dealer in polyester fibre yarn. In respect of the period in question, it had offered to tax the turnover from the sale of polyester fibre yarn at the rate of 2% taking the benefit of Notification in G.O.Ms.No.111, Commercial Taxes and Religious Endowments, dated 07.04.1998 (in short 'Notification'), which reads as follows: REDUCTION OF TAX PAYABLE ON SALE OF MANMADE STAPLE FIBRES, ETC. UNDER CENTRAL SALES TAX ACT (G.O.Ms.No.111, Commercial Taxes and Religious Endowments, 7th April 1998). No.II(1)/CTRE/43 (d-7)/98. In exercise of the powers conferred by sub- Section (5) of Section 8 of the Central Sales Tax Act, 1956 (Central Act 74 of 1956), the G....
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....ssing authority has proceeded to bring to tax the turnover at the rate of 10%. 6. The submissions made by Mr.Chandrasekaran, learned counsel for the petitioner are that the Notification would run in parallel with the stipulations under the relevant schedules. Relying on the judgments in Deputy Commissioner of Sales Tax V. Aysha Hosiery Factory (P) Ltd. (85 STC 106) and Sri Ayyanar Spinning and Weaving Mills Limited V. State of Tamil Nadu (109 STC 205), he would point out that the assessing authority has erred in imposing the condition relating to 'C' form over and above what has been contained in the Notification. In any event, there is no basis for the levy of tax at the rate of 10%. 7. Per contra, Mr.Prashanth Kiran, learned Gov....
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....erms and conditions on taxability as the State may consider necessary in public interest and may in this regard, impose such conditions as it believes necessary. 12. It is relevant to note that sub-Section (5) starts with a non-obstante clause and reads thus: (5) Notwithstanding anything contained in this section, the State Government may on the fulfillment of the requirements laid down in sub- section (4) by the dealer if it is satisfied that it is necessary so to do in the public interest, by notification in the Official Gazette and subject to such conditions as may be specified therein direct,.......... 13. The portion in bold as above, has been inserted vide Section 152(v) of the Finance Act (No.20 of) 2002, with effect from 11.05.2....
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....evant portion of the judgment reads as follows: .........When the assessing authorities sought to levy the additional tax imposed under the additional Sales Tax Act, 1978 in respect of the inter- state sale and called upon the assessees to pay at 1.1%, the dealers questioned the assessment orders on the ground that when once a notification has been made under Section 8(5) of the Central Sales Tax Act fixing the rate for purposes of C.S.T. any change in the rate of tax under the local act will have no impact on the notification itself unless the notification also is modified or amended giving effect to the amendment. This contention was accepted by Kochu Thommen. as he then was, in the judgment in the Janatha Expeller Co. & Ors. case (supr....
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....on 8(2-A) of the Central Sales Tax Act also in order to give better understanding of the provisions of section 8(5) of the Central Sales Tax Act. We are unable to see anything in this judgment to support the contention of the respondents-assessees that even in a case which is not covered by any notification under section 8(5) of the CST Act increase in the rate of tax under the local act will not have any effect on the applicability of Section 8(2)(b) and 8(2-A) of the CST Act. Further, for enhancing the rate notified under section 8(5) of the Central Sales Tax Act no reliance can be placed on section 8(2-A) of the CST Act. However, while agreeing with the view of the learned single Judge the Division Bench on appeal in the case of Assistan....
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.... not have any effect on the notification. That should have been enough to dispose of the case but they have given an alternative reasoning which in our view is not correct and is against the provisions of Section 8(2-A) of the CST Act itself. For the purpose of applicability of Section 8(2-A) of the CST Act we have to look to the rate of tax applicable for the time being under the local Act at the time when the CST Act was enacted. Any amendment in the local Act ultimately will have a reflection in the assessment of the inter-state sales. We have already discussed the scope of Section 8 (2-A) of the CST Act and in the light of those reasonings the passage extracted above in the judgment of the Division Bench is contrary to law and could not....