TMI Blog2017 (1) TMI 1622X X X X Extracts X X X X X X X X Extracts X X X X ..... g covered by CET Heading as others for "Tablet" is not found in IT Products' Notification, hence, is not covered by S/E C-56. The product covered by Excise Heading Tariff item No.87413090 is not a part of Notification issued for the purpose exemption of tax. The product "Tablet" is not covered by any schedule entry and it falls under residuary entry, E-1and liable to VAT at the rate of 13.5% - Similarly, the product viz. "Adopter" having CETH No. 85044090 is not a part of Notification issued by State Government for the purpose of schedule entry C-56. The product is not covered by any schedule entry and it falls under residuary entry, E-1and liable to VAT at the rate of 13.5%. Prospective effect - Held that:- The Commissioner or, as the case may be, the Advance Ruling Authority, may direct that the Advance Ruling shall not affect the liability of the applicant or, if the circumstances so warrant of any other person similarly situated, as respects any sale or purchase effected prior to the Advance Ruling - It is settled principle that the issue of prospective effect is to be considered on fact and circumstances of each case separately. There is no straight jacket formula to say th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purposes. It is made up of polyester, nylon or leather. As per usage requirements, you can choose backpacks with few and many compartments for storage. These backpacks are available in a large variety of colors and designs and you can easily buy branded laptop backpack. 2.2 The AC adapters help reduce the size of a laptop computer by alleviating the need for a standard sized power supply. The AC adapter is made up of a central unit which draws power from an AC outlet, converts the power to DC that is used by the computer, and a second cord that plugs into the computer. 2.3 The Tablet is a thin, flat mobile instrument with a touchscreen display, which is usually in color, processing circuitry, and a rechargeable battery in a single device. Tablets often come equipped with sensors, including digital cameras, a microphone, and an accelerometer, so that images on screens are always displayed upright. The working of Tablet is multifunctional and in conjunction with an automatic data processing machine. The chapter Note. 5(E) is related to heading 8471 is applicable and thus falls under residuary schedule of that Excise heading. Hence, the Tablets are covered by 8471 30 90. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; is also mentioned. However, it is contended that the addition of personal computer has been made in order to expand the scope of subheading 8471 30. This would not restrict the scope of 8471 30 for VAT purpose. Tariff items 8471 30 10 and 8471 30 90 are automatically covered under said Notification. He further stated that the interpretation as put forth by the applicant is not accepted then the entry will become redundant. All the items covered by description in sub-heading 8471 30 are further classified in tariff items. Tariff item 8471 30 10 covers personal computers. If above interpretation is not accepted and as 8471 30 10 is also not specifically mentioned in Notification under entry C-56, it will remain outside entry C-56. Similarly, the items covered under Tariff item 8471 30 90 also will remain outside the scope of the said notification. Thus, nothing will get belonging to sub-heading 8471 30. Obviously this cannot be interpretation as expected by the legislature. On the contrary the interpretation suggested by the applicant should be considered and accepted. It can be seen that the description is elaborative wherein items of tariff item 8471 30 90 are covered. Even if, p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en and prospective effect to the order of Advance Ruling may be given. a) He invited our attention to the decision of MSTT in case of German Remedies Ltd. (A.No.97 of 1991 dt.18.5.1996) and argued that in the said case, the dealer was misled by the earlier assessment orders, therefore, the prospective effect was granted by the Tribunal. The same principle will apply to the facts of the instant case as the dealer has been constantly assessed at lower rate in respect of impugned goods and this has led to assessee believing that the lower rate of tax is applicable to the goods sold by him. b) He has also placed reliance on the DDQ in case of Apsom Technologies (India) Pvt. Ltd. I Negi Sign System Supply Co. DDQ-1/2007/Adm-3/17-18/B-592 dt. 2.9.2009 and argued that, the learned Commissioner of Sales Tax noting that the importers have imported the impugned items in that case, i.e. ink jet printers under different Excise heading, granted prospective effect. The same principle will apply in relation to all impugned goods sold by the applicant in the instant case, as there are imports under different heading by the importers. It is contended that the applicant has already giv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ked in any material , the tax shall be leviable under section 6 on the sales of such packing material, whether such materials are separately charged for or not, at the same rate of tax, if any, at which tax is payable on the sales of the goods so packed. On analysis of charging section 7 of MVAT ACT, 2002, it is revealed that the rate of tax on packing material is applicable in specific condition which read as where any goods are sold and such goods are packed in any material . b) In the present case, the Laptop is packed in cartoon box and delivered to customers. The customer, as per his / her requirement, purchases 'back bag' and uses for conveyance during journey. Hence, it is not 'packing material' as prescribed under section to levy tax under section 7 of MVAT Act, 2002. The applicant stated that the 'back pack' is cleared under same heading of Laptop by Custom Authority. It is settled principle that the clearance of good is not relevant for the purpose of levy of sales tax. In the instant case, it is necessary that the impugned goods should fall under specific Excise Heading Notified by State Government. Further, at the time of hearing, Mr. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Conditions And exceptions Rate of Tax with effect from C-56. IT Products as may be notified by the State Government, from time to time. 4% 1.4.2005 to 31.3.2010 C-56. IT Products as may be notified by the State Government from, time to time. 5% 1.4.2010 to 31.3.2016 C-56. IT Products as may be notified by the State Government from, time to time. 5.5% 1.4.2016 to date C-56. IT Products as may be notified by the State Government from, time to time. 6% 17.9.2016 to date 4.3.2 The State Government has issued Notification (hereafter referred to Notification) in respect of S/E-C-56 as under and its interpretation:-Notification No. VAT 1505/CR-237/Taxation-1, Dated 17th October, 2005 . ln exercise of the powers conferred by entry 56 of the Schedule 'C' appended to the Maharashtra Valu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ether or not containing storage units in the same housing, including combined input or output units, line printer, dot matrix printer, letter quality daisy wheel printer, graphic printer, plotter, laser jet printer, ink jet printer, monitor, keyboard, scanners, mouse and other units . 8471 70 - Storage units, including floppy disc drives, hard disc drives, removable or exchangeable disc drives, magnetic tape drives, cartridge tape drive, CD-Rom drive, digital video disc drive, 8471 80 - Other units , of automatic data processing machines 8471 90 - Switch Mode Power Supply Systems and other goods . Note. - (1) The Rules for the interpretation of the provisions of the Central Excise Tariff Act, 1985 read with the Explanatory Notes as updated from time to time published by the Customs Co- operation Council, Brussels apply for the interpretation of this Notification. Note.- (2) Where any commodities are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s laid down the principle regarding the interpretation of word namely . The word namely means:- 1. Namely, (adv) :-that is to say: it was another colour, namely green. (Collins English Dictionary) 2. namely- that is to say; specifically: a new item of legislation, namely, the housing bill. (Random House Kernerman Webster's College Dictionary,.) 3. 'Namely'- we use namely to say exactly what we mean when we have just referred to something in a general or indirect way. For example , a) One group of people seems to be forgotten, namely pensioners. b) This virus was shown to be responsible for causing a very common illness, namely glandular fever. (Collins COBUILD English Usage HarperCollins Publishers 1992, 2004, 2011, 2012). B) The Hon supreme court and various High courts have categorically interpreted the word 'namely that is to say as under:- a) Hon. Madras High Court in case of the State Of Tamil Nadu vs. Kasiraja Nadar (1981 47 STC 337) (Mad), has discussed the term namely in the entry, Cattle feed, namely, hay or straw or rice bran or wheat bran or husk and dust of pulses and grams, but excluding - (i) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich were the subject-matter of the control under the Fertilisers Control Order, 1957. The revenue also did not dispute that bone-meal would come within the meaning of fertiliser but what was contended by the revenue was that it is not the manufacture of fertiliser in general that was given the benefit of rebate but only those enumerated items of fertilisers that were given the benefit. For this interpretation the revenue places reliance on the use of the word 'namely' after the word 'fertilisers'. It is the contention of the revenue that the word 'namely' restricts the interpretation of the fertilisers to those that are enumerated, though many other items would also be included in that word; and if the legislature intended to give the full meaning it would have either used that word alone or given an inclusive definition. We think that the learned counsel for the revenue is well-founded in this contention. And further observed that the passage in Corpus Juris Secundum, volume LXIV, at page 1084, where it is stated that the term 'namely' is a term which imports interpretation, that is, indicates what is included in the previous term. Thus, when the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the precise meaning of the words 'that is to say' must vary with the context........ But, in the context of single point sales tax, subject to special conditions when imposed on separate categories of specified goods, the expression was apparently employed to specifically enumerate separate categories of goods on a given list. The purpose of such specification and enumeration in a statute dealing with sales tax at a single point in a series of sales would, very naturally, be to indicate the types of goods each of which would constitute a separate class for a series of sales. Otherwise, the listing itself loses all meaning and would be with- out any purpose behind it. In regard to the test for determining the taxable events in relation to the sales tax, observed as follows: The mere fact that the substance or raw material out of which it is made has also been taxed in some other form, when it was sold as a separate commercial commodity, would make no difference for purposes of the law of sales tax. The object appears to us to be to tax sales of goods of each variety and not the sale of the substance out of which they are made......... As soon as separate comm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Such goods other than those listed, would not get covered by the said Notification, as the word namely restricts the scope. The other goods and other commodities would not be eligible to get benefit of the Notification. The Notification entry cannot be interrelated also as to enlarge the meaning and scope of the word specifically mentioned in the said Notification . Thus it is seen that the statute itself uses different expressions: namely ; for example ; that is to say . When the statute itself uses deliberately different expressions in different contexts, it is not a rule of interpretation to hold that all these expressions mean one and the same thing. If the intention of the legislature was to give the same meaning to the different expressions, the legislature would not have used different expressions, but would have used the same expression. g) Consequently there can be no doubt about the meaning of the word namely , that is, it is restrictive in the sense that the general expression which precedes the word namely is confined to the itemized expressions that follow the word namely . Consequently the meaning of the word namely can only be restrictive and can be ne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otification i.e. by the plain terms of the exemption. It is an application of this principle that a statutory Notification may not be extended so as to meet a casus omissus. As appears in the judgment of the Privy Council in Crawford v. Spooner (1). ....we cannot aid the legislature's defective phrasing of the Act, we cannot add, and mend, and, by construction, make up deficiencies which are left there. c) The Apex court has taken similar view in Union of India v. Wood Papers Ltd., (1990) 4 SCC 256, Gammon (I) Ltd. v. Comm. of Customs, (2011) 12 SCC 499, Commissioner Of Central Excise, V/S Mahaan Dairies on 17 February, 2004, (2004) 11 SCC 798. d) After analyzing the language of the Notification, words employed in Notification and rulings of Apex court, the said Notification is required to be interpreted strictly. The State Government has issued the Notification with specific Foot-Notes for interpretation so as to identify the specific commodities which are covered by the notification or otherwise. Similarly, the Central Excise Tariff Heading, sub-heading and item No. along with descriptions of commodities are linked with it, in order to grant the benefit of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Other u 12.5% - Other automatic data processing machines: 847141 -- Comprising in the same housing at least a central processing unit and an input and output unit, whether or not combined: 84714110 - Micro computer u 12.5% 84714120 --- Large or main frame computer u 12.5% 84714190 --- Other u 12.5% 84714900 --- Other, presented in the form of systems u 12.5% 84715000 - Processing units other than those of subheadings 8471 41 or 8471 49, whether or not containing in the sam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 84717010 --- Floppy disc drives u 12.5% 84717020 --- Hard disc drives u 12.5% 84717030 --- Removable or exchangeable disc drives u 12.5% 84717040 --- Magnetic tape drives u 12.5% 84717050 --- Cartridge tape drive u 12.5% 84717060 --- CD-ROM drive u 12.5% 84717070 --- Digital video disc drive u 12.5% 84717090 - Other u 12.5% 84718000 -- Other units of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot found in Notification Excise Tariff description and state govt. Notification description not identical / same c) The schedules, the description of goods and Notes appended to Notification should be read conjointly for the interpretation of nature of goods and also to conclude whether they are covered by said Notification or otherwise. We have to interpret that the goods, 'Tablet' described as other for Tariff item No. 84713090 is covered by said Notification or otherwise. The related Tariff Heading is reproduced as under. 8471 30 - Portable digital automatic data processing machines, weighing not more than 10 kg, consisting of at least a central processing unit, a keyboard and a display: 8471 30 10 --- Personal computer 8471 30 90 - Other - Other digital automatic data processing machines: The State Government has issued Notification for exemption of sales tax by tagging it with Central Excise Tariff heading with certain interpretation rules laid down in the Notes appended with said Notification. The Notification is provided with schedule and its purpose is to identify the specific goods wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t covered by the Notification. The IT product Notification has provided further sub-heading and further item no. with the description of the commodities for the purpose of exemption in rate of sales tax. Similarly, the excise heading 8471 30 is included intentionally for only personal computer. The intention of State Government is very clear to include those goods which are mentioned in the said Notification. If otherwise interpreted, then the provided subheadings and Tariff heading in the Notification would become redundant. Such type of interpretation ought not to be adopted . f) We have to analyse the Notification and its chronology of drafting for the purpose of exemption of sales tax. The State Government has purposefully included certain products having Heading OTHERS related to tariff item No. 8471 60 29. 8471 60 90 and 8471 90 00 in Notification to give exemption and purposefully not included certain products having Heading OTHERS related to tariff item No. 8471 30 90. 8471 41 90 and 8471 70 90 to deny the exemption . The product covered by Excise Heading Tariff item No. 8741 30 90 is not a part of Notification issued for the purpose exemption o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the whole of the word preceding. The nature of the included items would not only partake of the character of the whole, but may be construed as clarificatory of the whole. It has also been held that the word 'includes' may in certain contexts be a word of limitation (South Gujarat Roofing Tiles Manufacturers vs. State of Gujarat (1976) 4 SCC 601). In the context of Entry 62 of List II this would not mean that the word 'luxuries' would be restricted to entertainments, amusements, betting and gambling but would only emphasize the attribute which is common to the group. If luxuries is understood as meaning something which is purely for enjoyment and beyond the necessities of life, there can be no doubt that entertainments, amusements, betting and gambling would come within such understanding. i) The judicial pronouncements for interpretation of sales tax Notification linked with Excise Headinq:- A) Hon. Apex Court in the case of State of Punjab Others Versus Nokia India Pvt. Ltd. 2014 (12) TMI 836, has interpreted the relation of sales tax schedule entries which are linked to CETH No. for specific purpose to decide the rate of tax and held thus- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the commodity falls under the heading other in the Central Excise Tariff Act, 1985, then we have to look at the second column of the schedule to find out whether the commodities are covered by the said column. In case commodities/goods are not covered by the description given in the column, then commodities/goods will fall under the residuary tax rate. j) On this background, the Notification entries are required to be construed strictly and not liberally . The claim of dealer being goods namely provided in the Notification is only covered for exemption of sales tax. The CETH NO.8471 30 90 being covered by CET Heading as others for Tablet is not found in Information Technology Notification hence not covered by S/E C-56. The impugned goods - tablet is not covered by the relevant schedule entry as contended by the applicant and therefore, it falls under residuary entry, E-1 and liable to tax at the rate of 13.5%. 4.4 The rate of tax in case of 'Adopter':- The AC adapters help in a standard sized power supply. The AC adapter is made up of a central unit which draws power from an AC outlet, converts the power to DC that is used by the Laptop, and a second co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under principle of parity margarine which is produced by the respondents is rightly made taxable at four per cent by the Tribunal by its judgment The factual background, in which this decision was rendered, may now be referred to. The MSTT held that the 'margarine' was liable to be classified as 'vanaspati' on merit, in spite of certain differences of quality and tests. This aspect requires consideration, while deciding the ratio. It is very important issue for the purpose of Sales Tax statute and we are dealing with it in detail. The issue of Parity and determination of rate of tax of in taxing statutes (S-6): Another objection raised by the appellant is regarding the rate of tax levied by the seller of the goods while selling those goods to the appellant. He has further pointed out that the Hon. Bombay High Court, in case of Bungee India , reported (39 VST 213), has held that there must be parity in levying and recovering the tax among the various dealers selling the same commodity. He has submitted that as the supplier has levied the tax at the rate of 4%. Considering the principle of parity laid down by Hon. Bombay High Court, the tax should have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er then the said authority has to exercise it only in the manner provided in the same itself. If above dictum is followed then it becomes clear that when MVAT Act has laid down a particular procedure to be followed for the purpose of the determination of rate of tax then there is no alternative but to follow the same. The mandate of section 6 is the only prescription in deciding the rate of tax of a commodity when its sale is effected by a seller. The premise of the appellant that the goods received by him have been taxed at 4% by the seller, hence He is bound to imitate the seller as far as rate of tax of goods sold by him are concerned, is wholly irrelevant, illegal and baseless assumption, which if allowed to be adopted as a method for determination of rate of tax, then State Government would be deprived of its legitimate revenue and unscrupulous dealers would indulge into fixing of rate of taxes of goods on their own in breach of legal provision of section 6. Hence the appellant's contention is founded on unsound principles and bound to get rejected. We respectfully submit that only higher judicial forums have authority to decide the issue of parity. Being the authorit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etation of the provision without giving full effect to the; language used, would be unsupportable and hence not permissible. In Martin Burn Ltd. v. The Corporation of Calcutta , the Apex Court observed as under: That a result flowing from a statutory provision is never an evil. A court has no power to ignore that provision to relieve what it considers a distress resulting from its operation. A statute must, of course, be given effect to whether the Court likes the result or not. vi) Similar view has been taken by the Hon. Supreme Court in Raees Ahmad v. State of LLP. and Ors. AIR 2000 SC 583; Mool Chand v. Kedar; and Kadivala Rama Rao v. Gutala Kahna Rao (2000) 3 SCC 87. vii) In V.V.S. Sugars v. Government of Andhra Pradesh, the Hon'ble Supreme Court observed that while interpreting the tax statute, the literal and strict construction is to be applied The Court has to read a fiscal statute as it reads, with no addition and no subtraction on the ground of legislative intendment and reading it otherwise would defeat the legislative intent. Similar view has been reiterated in Shyam Kishori Devi v. Patna Municipal Corporation AIR 196c SC 1678; Gulam Yasin Khan v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed relied on by the petitioner. The Hon. Kerala High Court held that we feel classification of same goods has to be uniform both at the hands of the manufacturer as well as at the hands of dealers to ensure smooth levy of tax under the VAT Scheme which entitles purchasing dealers for input-tax credit. The Hon. High Court has directed to clarify the issue by Commissioner/ Concern Authority with direction that the petitioner will file an application for clarification along with a copy of this judgment before the Commissioner of Commercial Taxes, who, either by himself or through the competent authority, will clarify the rate of tax within two months after issuing notice to the manufacturer as well, whose address will be furnished by the petitioner. Fresh assessment will be issued based on the clarification by the authority, as stated above, within one month from the date of receipt of clarification. If the assessing officers take divergent views, clarification on rate of tax by the Commissioner under section 94 of the KVAT Act is the only solution and clarification in this case is not only desirable but is required because, manufacturer is called upon to pay tax at four per cent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing that 'electronic cash register' sold by the applicant was covered by entry No. 90 of Schedule C, Part II and not by entry No. 97(b) of Schedule C, Part II appended to the Bombay Sales Tax Act, 1959 . In present case, we do not find two entries for deciding the specific and general entry for levy of sales tax. However, the issue is related to interpretation of Notification issued for the schedule entry C-56. We do not find any reason to apply the ratio to present case. d) Mr. C. B. Thakar, Advocate stated that the benefit of doubt the lower rate to tax should be applied and relied on Bharat Vijay Mills Ltd. (85 STC 23). The question for consideration in these writ petitions is whether sintex water drums fall within entry 118 of the Second Schedule (containers other than gunnies) or falls under entry 110 that is articles made of Polythene. The factual background, in which this decision was rendered, may now be referred. According to the petitioners these water drums are to be taxed as containers because they are used to store water as a container. The Hon. Court found that there are two competing entries regarding Sintex water drums. It is possible to tak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ised as 'cement' whether of a superior or inferior quality, but was known as a cement substitute . The respondents have produced nothing to show to the contrary. A substitute necessarily implies a difference in identity. When once it is admitted that lympo is a cement substitute, the Tribunal could not have come to the conclusion that lympo was cement or a variety of cement. In our view, there is no ambiguity in the definition of T.I. 23(1) or 23(2). Even if there were, on the principle that when two constructions can be equally drawn, the one favorable to the tax payer should be adopted, the Tribunal should have held in favor of the appellant. In fact, The Hon. Apex Court observed that the product is not cement but can be used for some purposes like cement, such product is not cement but was known as a cement substitute . When once it is admitted that lympo is a cement substitute, the Tribunal could not have come to the conclusion that lympo was cement or a variety of cement. In present case there is neither two test of interpretation applicable nor can two constructions be equally drawn to interpret the schedule entry. However, we are dealing with interpretation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not covered by the said Sr. No. 82 is absolutely irrelevant and illogical. So long as the chemicals in question answer the description of the goods in Col. (4) and so long as they are covered by the broad heading 29.15, they will certainly be covered by the said Sr. No. 82 and hence would befall the Schedule Entry C-l-29 during the relevant period. It is observed from said ruling that the Central Excise heading- 29.15 is pari materia with the State Government Notification and hence concluded the case on non restriction of scope of Central Excise Sub-heading in that regard. In present case, as we have already discussed at length that the Central Excise Tariff heading - 8471 is not pari materia / identical with the Notification of Information Technology Products as it excludes the term Not elsewhere Specified or included . Hence, the ratio of said decision is not applicable to present case. On the contrary, it fortifies our view. 6. The rate of tax on Adopter:- The AC adapters help in maintaining a standard sized power supply. The AC adapter is made up of a central unit which draws power from an AC outlet, converts the power to DC that is used by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e entry C-56 and is liable to VAT at the rate of 13.5%. 7. Conclusion:- In View above conversation, the conclusion is drawn as under. 7.1 The back pack is used for conveyance of laptop during journey. The Laptop is packed in cartoon box and delivered to customers. The customer, as per requirement purchases back bag and uses for conveyance during journey. Hence, it is not packing material as such prescribed under charging section to levy tax under section 7 of MVAT Act, 2002. The product is not covered by the schedule entry as claimed by the applicant and it falls under residuary entry, E-1, and thus liable to VAT at the rate of 13.5%. 7.2 The Tablet is a thin , flat mobile instrument with a touch screen display, which is usually in color, processing circuitry, and a rechargeable battery in a single device. Tablets often come equipped with sensors, including digital cameras, a microphone, and an accelerometer, so that images on screens are always displayed upright. The applicant has discharged tax liability at the rate of 5.5% or 6% on the sale of Tablet , with contention that products being information technology products should covered by S/E-56, which is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the goods, Tablet described as other for Tariff item No. 8471 30 90 is whether covered by the said Notification or otherwise. In the present case, as we have already discussed at length that the Central Excise heading - 8471 is not identical , similar or matching in totality with the corresponding entry in the Notification as it excludes the term Not elsewhere Specified or included . Hence, Notes appended to Notification issued by State Government are very significant and comes into picture as an aid to interpret the entry in the notification. Therefore, the Rules of interpretation provided in Note - 2 and Note - 4 shall be applicable . d) The, Rule (1) is a general rule of interpretation and is not subject to Rules (2) to (4). Rules (2) to (4) suggest that we should examine the description given in the notification and compare it with the description of the goods mentioned in the relevant entry in the Central Excise Tariff Act, 1985. If the same are identical, then we should apply the same interpretation, as has been given to the entry in Central Excise Tariff Act, 1985. If the entries are not identical or the commodity falls under the heading other i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roduct is not covered by any schedule entry and it falls under residuary entry, E-1and liable to VAT at the rate of 13.5%. h) In view of above discussion , court rulings and legal position discussed at length, the contention advanced by applicant does not have any merit and not sustainable. 8. The prospective effect:- Mr. C. B. Thakar, Advocate stated that if Authority arrived to different opinion, and it is held that product is not covered by the said schedule entry as proposed by the applicant, then benefit provided in section 55(9) shall be given to him and prospective effect to Advance Ruling order may be given. Therefore, considering above facts and circumstances, the protection may be given by making the ruling prospective from the date of pronouncement. Further, he requested to grant benefit provided in section 55(9) of MVAT Act, 2002. He relied on some rulings, which are discussed as under. (a) Mr. C.B. Thakar , Advocate has placed reliance on MSTT judgment in the case of German Remedies Ltd. SA No. 97of 1991 decided on 18th may 1996. He stated that the prospective effect was granted on account of assessee being misled by assessment order. (b) Mr. C. B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the section 56 of MVAT ACT, 2002 laid dawn the principles regarding the granting of prospective effect and observed in relevant Para that- 10. On plain reading of both the subsections (1) and (2) of Section 56, it is apparent that the Commissioner may direct that the determination shall not affect the liability under the MVAT Act of the applicant or if the circumstances so warrant, of any other person a similarly situated, as respects any sale or purchase effected prior to a determination. Therefore, this is not a mandate but a discretionary power vested in the Commissioner. This discretionary power has to be exercised and while exercising it, the Commissioner, has to be guided by certain inbuilt checks and safeguards. He cannot in the garb of giving relief of the nature contemplated by subsection (2) totally wipe out the liability of any and every dealer. 11. The Commissioner is expected to exercise this discretionary power so as not to defeat the law or render its provisions meaningless or redundant . The power must be exercised bearing in mind the facts and circumstances in each case. No general rule can be laid down. The exercise of this discretionary power must be bon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In the present case , as discussed above on the merit, there is no ambiguity in the entries of the Notification. The Notification is to be reguired to read with Notes appended with it and interpret accordingly . There is no scope, for any doubt arising out of the provisions. However, the various court authorities have upheld the principles of strict interpretation of Notification provided in sales tax statutes. This aspect is not new for interpretation of Notification issued for the purpose of sales tax exemptions or granting the concession in rate of tax under the sales tax statutes by way of Notifications. As discussed in earlier paras, the Hon. Apex court and various Courts have held that the Notification issued for sales tax exemption is to be construed strictly and not liberally. We have already discussed that the Notes appended with State Notification are very clear to interpret it. There is no ambiguity in language provided in the Notification . The applicant should have proved beyond doubt that he is eligible for benefit of Exemption Notification. We do not find any compelling circumstances to use discretionary powers. The trade of impugned commodities is well es ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
