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2019 (2) TMI 1015 - HC - VAT and Sales TaxValidity of Higher Rate of tax on Rectified Spirit - authority to collect the tax amount at 20% on rectified spirit - the rectified spirit and ethyl alcohol are one and the same - Held that:- Rectified spirit is ultimately used in alcoholic beverages for human consumption. Therefore, this commodity is mentioned in Entry 12(ii) of Part “S” of the II Schedule and attracts tax at the rate of 20%. Therefore, it is contended that when rectified spirit is ultimately used to create two different commodities which is fit for human consumption therefore 20% tax is levied - On the other hand, ethyl alcohol is used as an intermediate material in the manufacture of other commodities and therefore attracts a lower rate of tax at 10%. This we find to be acceptable. It cannot be said that the differential rate of tax made by the State is perverse. Specific reasons have been assigned as to why the tax on rectified spirit is at much higher rate than that of ethyl alcohol. The reasons have been substantiated through their affidavit. The reasons assigned for the different rate of tax is completely justified by the respondent-State - Appeal dismissed - decided against appellant.
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