Home Case Index All Cases VAT and Sales Tax VAT and Sales Tax + HC VAT and Sales Tax - 2021 (7) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (7) TMI 329 - KARNATAKA HIGH COURTLevy of Entry tax - unmanufactured tobacco in sealed container - covered under Entry-5[ii] of the Notification dated 30.03.2002 in No.FD.11.CET.2002[I] as amended by the subsequent Notification dated 01.10.2013 in No. FD.208.CSL.2013[III] or otherwise? - Whether the first respondent is justified in clarifying that the unmanufactured tobacco is brought into the local area in "sealed container" and is covered under Entry 5(ii) of the aforesaid notifications and therefore, is liable for tax under section 3(1) of the KTEG Act? - HELD THAT:- All the references are qua the registered dealer (or dealer liable to be registered or the dealer) and the point of entry into the local area, and there is no reference to point of sale in section 3 of the KTEG Act. The place of business is defined to be the place where dealer is doing business and the value of goods is the purchase price at which the dealer purchases the goods. There is no reference to retail price or retail place of business. Thus, it is obvious on a plain reading of these provisions that the legislature intended the point of entry into the local area as the taxable event for the purposes of levy of entry tax and not the point of sale. If the intendment of the legislature, as is obvious from the provisions of the KTEG Act, is to stipulate entry of goods into the local area as the taxable event, this Court cannot opine that the taxable event must be the point of consumption, use or sale because goods are packed differently for wholesale and retail purposes. The fact that the unmanufactured tobacco is sold in retail in paper pouches that are just folded and the folds are kept in place by a loosely glued label would be of no consequence. As already observed, at the point-of-entry into the local area, the unmanufactured tobacco was in a sealed container - the first respondent is justified in clarifying that the unmanufactured tobacco is brought into the local area in a sealed container and is covered under Entry 5 (ii) of the aforesaid notifications and therefore, is liable for tax under section 3 (1) of the KTEG Act. Whether, the second respondent, in exercise of the jurisdiction conferred under section 17(5) of the KTEG Act, by the impugned order/s dated 17.08.2020 could have rectified the assessment orders dated 12.04.2019 issued for the assessment years 2014-15, 2015-16 and 2016-17 and levied entry tax as per the demand? - HELD THAT?:- The treating of the unmanufactured tobacco brought into the concerned local area by the petitioner in the assessment orders dated 12.04.2019 as ‘Non-assessable’ excluding the relevant turn over from the assessment, undeniably, would be prejudicial to public revenue in the light of the terms of the amendment Notification dated 01.10.2013 and the provisions of Section 3(1) of the KTEG Act. The unmanufactured tobacco brought into the local area by the petitioner is treated as “Non-assessable’ only because of the interim orders of this Court in the aforementioned writ petitions filed by the petitioner impugning the amendment Notification dated 01.10.2013, and it is also subject to the condition that such assessment orders would be reopened after the final decision in the writ petitions. The petitioner’s grievance is that the impugned rectification orders are consequent to the impugned Clarification order dated 29.6.2020, and if the rectification orders are consequent to a judgment or order by the Court, the petitioner cannot, and in fact, does not have a grievance - the second question is also answered against the petitioner concluding that in the facts and circumstances of this case, the second respondent, is justified in exercising the jurisdiction conferred under section 17(5) of the KTEG Act and rectifying the assessment orders dated 12.04.2019 issued for the assessment years 2014-15, 2015-16 and 2016-17. Petition dismissed.
|