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2023 (1) TMI 246 - HC - VAT and Sales TaxClassification of goods - rate of tax - whether tyres and tubes used in tractor-trolley manufactured by the petitioner is liable to be taxed separately @ 12.5% for the tax periods up to 31.03.2011 and @ 13.5% after 01.04.2011 as per Part-III of Schedule B or @ 4% in terms of Entry 119 of Part-II of Schedule B appended to the OVAT Act? - Penalty under Section 42(5) of the OVAT Act - applicability of cases of UNION OF INDIA VERSUS M/S RAJASTHAN SPINNING & WEAVING MILLS AND COMMISSIONER OF CUSTOMS AND CENTRAL EXCISE VERSUS M/S. LANCO INDUSTRIES LTD. [2009 (5) TMI 15 - SUPREME COURT] which has been relied on by the Hon’ble Supreme Court in the case of CCE, CHANDIGARH VERSUS PEPSI FOODS LTD. [2010 (12) TMI 15 - SUPREME COURT] - HELD THAT:- It is not in dispute that Entry 119 of Part-II specifically carves out exception. The goods “tyres, tubes and flaps” are excluded from the words “Tractors, threshers, harvesters and attachments and parts thereof” used in the said entry. It is stated in M/S. DEEPAK AGRO SOLUTION LTD VERSUS COMMISSIONER OF CUSTOMS, MAHARASHTRA [2008 (5) TMI 8 - SUPREME COURT] that what is not excluded would be held to be included - In COMMISSIONER OF CENTRAL EXCISE VERSUS SHREE BAIDYANATH AYURVED BHAWAN LTD. AND VICE VERSA [2009 (4) TMI 6 - SUPREME COURT] it is laid down that specific entry must prevail over a general entry. This Court in STATE OF ORISSA VERSUS BHARAT STORE [2002 (2) TMI 1299 - ORISSA HIGH COURT] held that it is a settled position of law that a taxing statute is to be strictly construed and the words used are to be given their natural meaning. It is also the settled position that entries in the Schedule are to be interpreted in their popular sense unless they are expressly defined in the enactment. In RAJ BROTHERS AGENCIES AND OTHERS VERSUS THE STATE OF TAMIL NADU [1976 (2) TMI 174 - MADRAS HIGH COURT] it has been stated that a special entry overrides a general provision. If main article to which the item in question is accessory or component part is taken out of that item, its accessories and component parts could not be said to have been left untouched. Though batteries may be electrical goods and battery plates are accessories or component parts of such batteries, in view of the specific entry, batteries as such were excluded from general entry. This Court is of the considered opinion that “tyres, tubes and flaps” being excluded from the purview of preceding words, namely “Tractors, Threshers, harvesters, and attachments and parts thereof” as contained in Entry 119 of Part-II of Schedule B appended to the OVAT Act, the subject-goods do not fall within ambit of said entry. No specific entry being available, “tyres, tubes and flaps” are, thus, subject to tax @ 12.5% up to tax period ending on 31.03.2011 and @ 13.5% after 01.04.2011 as per Part-III of Schedule B to the OVAT Act. For the aforesaid reasons, the interpretation as suggested by the learned counsel for the petitioner cannot be acceded to. Penalty under Section 42(5) of the OVAT Act - applicability of cases of UNION OF INDIA VERSUS M/S RAJASTHAN SPINNING & WEAVING MILLS AND COMMISSIONER OF CUSTOMS AND CENTRAL EXCISE VERSUS M/S. LANCO INDUSTRIES LTD. [2009 (5) TMI 15 - SUPREME COURT] which has been relied on by the Hon’ble Supreme Court in the case of CCE, CHANDIGARH VERSUS PEPSI FOODS LTD. [2010 (12) TMI 15 - SUPREME COURT] - HELD THAT:- With regard to applicability of ratio of decision in UNION OF INDIA VERSUS M/S RAJASTHAN SPINNING & WEAVING MILLS AND COMMISSIONER OF CUSTOMS AND CENTRAL EXCISE VERSUS M/S. LANCO INDUSTRIES LTD. [2009 (5) TMI 15 - SUPREME COURT], which has been relied on by the Hon’ble Supreme Court in the case of CCE, CHANDIGARH VERSUS PEPSI FOODS LTD. [2010 (12) TMI 15 - SUPREME COURT], needless to say that since they are rendered in different context and under different statutory setting of words, the reliance placed by the petitioner is misplaced. The questions of law are answered in favour of the Revenue and against the petitioner-dealer - Petition dismissed.
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