2007 (10) TMI 301
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....ppreciate the issue raised by the Revenue, few relevant facts may be stated. 4. The respondents in this appeal are manufacturers, dealers or traders of electronic goods, components and materials. They are duly registered under the State Act as well as Central Act. Their claim was that Capacitors, manufactured by them, was exigible to tax at a concessional rate as 'electronic goods' in terms of various Government Orders issued from time to time and not as 'electric goods' subject to higher tax. It was their case that the Assessing Authorities had taken conflicting views in different cases. In some cases, while making assessment orders, they accepted the case of manufacturers/dealers/traders treating Capacitors as 'electronic goods' and levied concessional rate of tax; while in other cases, the Assessing Authorities negatived such claim as to concessional rate of tax and ordered to levy Capacitors as 'electric goods'. Where the Assessing Authorities had decided against the assessee, the assessee challenged the action before the Tribunal and where the issue was decided by the Authorities in favour of assessee, the Revenue had challenged such decision. All the matters were, therefore,....
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....isposal. 7. We have heard learned counsel for the parties. 8. The learned counsel for the Revenue challenged the decision of the High Court. He submitted that the High Court was not at all justified in interfering with the order passed by the Tribunal. He urged that a finding of fact was recorded by the Tribunal which was 'final' and could not have been interfered with by the High Court in Revisions. It was also submitted that the Tribunal, in any case, had remanded the matter and it was thus not a 'final order' which could have been disturbed by the High Court. If the assessee was in a position to convince the Authorities that he was entitled to concessional rate of tax, the Authorities would have decided the case in his favour. The High Court was, therefore, not right in entertaining and allowing Revisions. The counsel submitted that where a particular item is subject to payment of tax and the case of the assessee is that he is not liable to pay tax or is liable to pay tax at a concessional rate, the burden is on him to establish such case as it is an exception to the general rule. Such provisions of law - primary or delegated - must be construed strictly. It was also argued th....
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.... so as to ensure industrial growth in the State. A provision which has been intended for a laudable object of industrial development, must be liberally construed. And, even if two views are possible, the view favourable to the assessee should be adopted. When the High Court has taken such view, this Court may not interfere with it under Article 136 of the Constitution. It was also submitted that the High Court was wholly justified in criticizing the approach adopted by the Tribunal. The High' Court was right in holding that 'operating principle' or 'user test' would apply to those cases where there is no express mention of a particular item in the notification or G.O.Ms. But once the item is specified in the list, there should not be further inquiry and the assessee would be entitled to concessional rate of tax on the basis of such entry. In the case on hand, several items were specifically mentioned in various G.O.Ms. 'Capacitors', admittedly, was one of them. In view of the said position, the Tribunal exceeded its jurisdiction in applying 'operating principle'' or 'functioning' of the item and the High Court was right in criticizing it. The High Court was also constrained to obse....
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....ecretary to Government of Andhra Pradesh, Revenue (CT-II) Department, inviting the attention of the Commissioner of Commercial Taxes to the reference cited in the said Memo and informing him that the Government had decided that the list of electronic items prepared by the Electronic Commission should be followed for the purpose of concessional rate of tax on electronic goods ordered in G.O.Ms. Nos. 520 and 521. The Commissioner was requested to issue necessary instructions to subordinate officers under Section 42A of the State Act. 13. Pursuant to the above Memo, a Circular was issued by the Commissioner of Commercial Taxes on July 13, 1989 which is also relevant and reads thus : Office of the Commissioner of Commercial Taxes Andhra Pradesh : Hyderabad Dated 13-7-1989 Ref. Al/1240/88 M.V. NATARAJAN, I.A.S. COMMISSIONER OF COMMERCIAL TAXES CIRCULAR Sub : APGST Act & CST Act - Reduction in the rate of tax on Electronic goods-Reg. Ref. : l. G.O. Ms. No. 520 Rev dt. 20.07.1988. 2. G.O.Ms. No. 521 Rev dt. 20.07.1988. 3. Govt. Memo No. 23718/CT. 11.2./89 dated 01.06.1989 It is informed that vide G.O.s first and second cited, Government were pleased to reduce the rate of tax ....
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....the batteries are electronic components and since the electronic components are one of the items which are eligible for concessional rate of duty and since the clarification in the list prepared by the Electronics Commission is treated as part of the G.O. the batteries manufactured by the assessee are eligible for concessional rate of duty under G.O. Ms. No. 520, Revenue dated July 20, 1988 and G.O. Ms. No. 521 Revenue dated July 20, 1988 issued under the A. P. General Sales Tax Act and also Central Sales Tax Act." 18. It appears that the Revenue challenged the decision of the High Court by filing Civil Appeal Nos. 723-25 of 1999, but a three Judge Bench of this Court dismissed them on March 21, 2001 observing that there was "no good reason to interfere with the order under appeal." 19. Once again, the issue came up for consideration before the same Court in India Extrusion v. Commissioner of Commercial Taxes, A. P., Hyderabad, (2001) 124 STC 474. In India Extrusion, the Court was considering the item of 'Cable Joining Kits'. Relying on G.O.Ms. Nos. 520 and 521 and taking recourse to the list of electronic goods prepared by Electronic Commission, the High Court held that it could....
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....by the Electronics Commission. In fact, when similar issue came up for consideration before this Court in Amara Raja Batteries, [1998] 111 STC 664, while considering G.O. Ms. Nos. 520 and 521, referred and relied upon the list prepared by the Electronics Commission as was ordered to be adopted by the Government by its memo dated June 1, 1989. As batteries, which fell for consideration, was found under item 13.93, the division Bench accepted the claim of the assessee and upheld the decision of the Tribunal where the Tribunal allowed the claim of the assessee treating the batteries as electronic component. But, however, this decision was distinguished by the Tribunal in the impugned orders on unsustainable grounds". (emphasis supplied) 21. To us, the High Court was also right in indicating that when the item has been specifically included in the list prepared by Electronic Commission, the Tribunal could not have applied 'functional test' 'operating principle' or user test'. A limited inquiry which was required to be made by the Tribunal was whether the item had been included in the list prepared by the Electronic Commission. If any item is included in the said list, it has to be tre....