Home Case Index All Cases VAT and Sales Tax VAT and Sales Tax + HC VAT and Sales Tax - 2018 (3) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (3) TMI 815 - HC - VAT and Sales TaxRate of tax - Un-interrupted Power Supply Systems (UPS) - Validity of clarification issued by the first respondent, dated 13.01.2006, in Clarification No.11/2006 - first respondent stated that the UPS with built in battery, or attached to batteries is also known as 'Inverter' and taxable at 16% under Entry No.5(i) of Part-E of the First Schedule to the TNGST Act, and if imported, it is taxable at 20% under Entry No.9 of 11th Schedule. Held that: - the observation made in the impugned clarification that UPS is also known as ''Inverter'' is not substantiated by any material, and appears to be a personal opinion of the Authority. That apart, the clarification states that the UPS should be treated as Inverter, and taxable at 16% under Entry No.5(i) of Part – E of the First Schedule - This entry cannot made applicable, since it deals with Generators, Generating Sets, Transformers and Non-Electronic Voltage Stabilizers. Therefore, the impugned clarification is wholly flawed. Though the articles are not authenticated, it gives a broad distinction between a UPS and Inverter. The subtle but relevant distinction, which has been shown is that UPS is used in the Desktop Computers, and provides power in the case of power-cut, and the Computer does not shut down, whereas, the Inverter is only a power back up solution, it converts Direct Current into battery current electricity, and mainly used to supply back up power for homes and offices, and cannot be used for a Computer system. That apart, there is a gross difference in back up time for both UPS and Inverter, apart from the circuitry difference. The impugned clarification is incorrect and cannot be made applicable to the petitioner - petition allowed - decided in favor of petitioner.
|