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2012 (11) TMI 1056 - HC - VAT and Sales TaxWhether the premium received on surrender of REP licences/exim scrips is 'sale consideration'? Whether the transaction of surrender of the REP licences/exim scrips pursuant to circular No. 11/93 dated May 5, 1993 is in the nature of 'sale' within the meaning of section 2(1)(n) of the Andhra Pradesh General Sales Tax Act, 1957 and therefore, would constitute "turnover' within the meaning of section 2(1)(s) of the Andhra Pradesh General Sales Tax Act "? Held that:- Admittedly the policy and system under which the REP licences/ exim scrips were issued were discontinued with effect from March 1, 1992 and the unutilized REP licences/exim scrips could be surrendered to the Government of India by the assessees and they would be paid 20 per cent premium as per the circular No. 11/1993 dated May 5, 1993. After March 1, 1992, the holders of unutilized REP licences/exim scrips cannot deal with them in the open market or utilize them for importing goods as the very policy and scheme under which they were issued are discontinued. By no stretch of imagination can it be said that such a surrender by an exporter of REP licences/exim scrips is in the course of trade or business. The premium paid by the Government to the exporters on the surrender of the REP licences/ exim scrips is only a solatium for the inability of the exporters to avail of the benefit of the incentives and in our view cannot be treated as price or valuable consideration. Therefore, the transaction of surrender of REP licences/exim scrips is not a "sale" within the meaning of section 2(1)(n) of the Act and also would not constitute "turnover" within the meaning of section 2(1)(s) of the Act.
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