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2016 (11) TMI 214 - HC - VAT and Sales TaxLevy of tax u/s 8(1) of the CST Act - Inter-State sale of LPG - it was contended that, no tax could be levied on interState sales of LPG since the local sales thereof are exempt from payment of tax - Held that: - The term “rate of tax” used in the proviso and “rate applicable” in the main body of subsection( 1) of section 8 must receive similar interpretation. Further, under subsection( 2) of section 8, it is provided that tax payable by any dealer on his turnover in so far as the turnover or any part thereof relates to the sale of goods in the course of interState trade or commerce but not falling within the subsection( 1), shall be at the rate applicable to the sale or purchase of such goods inside the appropriate State under the Sales Tax law of that State. In contrast to subsection( 1), thus subsection( 2) does not provide for the lower of the two tax rates, 2% as prescribed for interState sales generally or the rate that may be prescribed by the local Sales Tax law. It prescribes only one rate of tax namely, that which is applicable to the sale or purchase of goods in question within the State on the local sales. There is therefore, no warrant to interprete the expression “rate applicable to the sale or purchase of such goods” used in subsection( 1) of section 8 as to mean the prescribed rate and not the rate which may be applicable taking into account the exemption totally or partially that may have been granted by the State Government. The expression “within the State of Gujarat” does not aim to collect tax on interState sale. In fact, learned Advocate General also stated that this could not be and is not even the intention of the State legislation - we do not find that the amended entry 69 is in any way unconstitutional or outside the legislative competence of the State delegated legislation. Our interpretation and the order of dismissing the appeal would take care of other prayers of the petitioner in the Special Civil Application. Same is disposed of accordingly - appeal dismissed - decided against Revenue.
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