Home Case Index All Cases VAT and Sales Tax VAT and Sales Tax + HC VAT and Sales Tax - 2018 (2) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (2) TMI 1223 - HC - VAT and Sales TaxConcessional rate of tax - purchase of spares for machinery, against Form XVII - case of Revenue is that spares and machineries, intended for repair and reconditioning, are not eligible to be purchased, against Form XVII, under Section 3(5) of the Tamil Nadu General Sales Tax Act, 1959, as per the clarification issued by the Commissioner of Commercial Taxes, Chennai K.Dis.Acts Cell-I/13063/2004, dated 14.09.2004 - Whether the disputed turnover is not eligible for concessional rate of tax as provided under Section 3(5) of the Tamil Nadu General Sales Tax Act, 1959? - Whether the penalty under Section 23 of the Tamilnadu General Sales Tax Act, 1959 is warranted in this case? Held that: - In the present case, the goods sold fall within the items mentioned in Entry 3 of the Eighth schedule. Therefore, the assessee has satisfied the first condition. In respect of the second condition, ie., use in the factory site within the State, there is no dispute that the same were used in the factory site, within the State. Hence, the second condition is also satisfied. The third condition is that the goods should be used in manufacture. Use may be direct or indirect, in the process of manufacture. Plant and machinery are used for the purpose of manufacturing vanaspathi and bakery shortening. Since the goods are installed and used in the factory site, the respondent-dealer is entitled to the concessional rate of tax at 3%. Therefore, the Tribunal has rightly held that the disputed turnovers are eligible for concessional rate of tax, provided under Section 3(5) of the Tamilnadu General Sales Tax Act, 1959. The assessee has satisfied all the conditions enumerated and Section 3(5) of the Act and hence, they are entitled to the concessional rate of tax under Section 3(5) of the Act - Section 3(5) of the Act is a beneficial provision. It provides for concession in tax to encourage industrial activity. It is well settled principle that a taxing provision, granting concessional and incentives for promoting growth and development, should be construed liberally. Revision dismissed - decided against Revenue.
|