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2021 (9) TMI 477 - HC - VAT and Sales TaxRefund claim - availability of Sales tax exemption or not - whether the petitioner namely M/s. Akbari Continental Pvt. Ltd. is a "Hotel" or comes under "Guest House and Restaurants" under Clause-27 of the ineligibility list - Entry 30-FFFF vide Finance Department Notification dated 16.08.1990 - disallowance of claim of first point sale of cold-drinks and IMFL U/s. 5(2) (A) (a) read with Section 8 of Orissa Sales Tax Act. Whether by selling IMFL, cold drinks in its hotel it was part of the list of units excluded from exemption under Sl. No. 27 of IPR 1989? - HELD THAT:- The Tribunal has for the three AYs 1993- 94, 1994-95 and 1996-1997 rejected the plea of the Department that the Petitioner’s unit is to be categorized as a ‘restaurant’ and denied the exemption in terms of Entry 30-FFFF. This Court finds no reason why only for AY 1995-96 the Department’s case ought to be accepted by the Tribunal particularly since the eligibility certificate issued by the DIC is the same for all these AYs - question is answered in favour of the Petitioner and against the Department by holding that the Petitioner is a hotel and does not fall under Clause 27 of the ineligibility list of IPR-1989 and is entitled to sales tax exemption under Entry 30-FFFF in terms of the Finance Department Notification dated 16th August, 1990. Whether in the facts and circumstances of the case, disallowance of the case, disallowance of claim of first point sale of cold-drinks and IMFL U/s. 5(2) (A) (a) read with Section 8 of the Act is sustainable in law? - HELD THAT:- It is not in dispute that the Petitioner is not the first seller in respect of cold drinks. It has produced the invoices to show from whom it has purchased the soft drinks. The Tribunal appears to have rejected these invoices only because the seller was not a registered dealer. But the Tribunal has for the AYs 1993-94 and 1996-97accepted that the cold drinks have suffered tax at the first point of sale and that irrespective of the sellers of such cold drinks not being registered dealers themselves, the cold drinks cannot be made exigible again to sales tax. This appears position also flows from a reading of Section 8 read with Explanation (1) to Section 5 (2) (A) (a) of the OST Act. Reliance placed in the case of GOVINDAN & CO. VERSUS THE STATE OF TAMIL NADU [1974 (2) TMI 69 - MADRAS HIGH COURT], where the Madras High Court held that to claim benefit of tax on the ground that the sales effected by the Assessees were second sales, they need not show that their sellers had in fact paid the tax at the first point. It was enough for them to show that the earlier sales were taxable sales and the tax was really payable by their sellers. The issue is thus answered partly in favour of the Petitioner by holding that the disallowance of claim of first point sale of cold drinks under Section 5(2) (A) (a) read with Section 8 thereof was not sustainable in law. However, the observation of the Tribunal in regard to the issue of sale of IMFL requiring further enquiry is upheld and the issue of sale of IMFL by the Petitioner for the AY 1995-96 is therefore remanded to the Assessing Authority for a fresh determination. Petition disposed off.
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