TaxTMI 
TaxTMI 
2013 (3) TMI 315
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....tem under Schedule I as item 40 Part B and it was made taxable at the point of first sale @ 4% and from 27.3.2002 the same was brought under Entry 9 Part G of the First Schedule and was taxed at 25% at the point of first sale. Subsequently, by virtue of Act 22 of 2002, Schedule 11 was inserted from 27.6.2002, whereunder the 'Kerosene' was brought under Serial No.10. Under G.O.Ms.No.25 CT (B-1), dated 21.3.2003, by Act 21 of 2003, Serial No.18 was inserted, whereunder Superior Kerosene Oil (White Kerosene) was specified as a taxable entry levying tax at 25% at the point of first sale in the State. Under the same amendment, Entry 10 was amended to read "Kerosene other than white kerosene - First sale - 4 per cent". Moreover, under Section 3H of the Tamil Nadu General Sales Tax Act, a resale tax has been made leviable on the dealers whose turnover is not less than Rs. 10 lakhs @ 1% and under Section 3-I, a surcharge at the rate of 5% has been made leviable with effect from 1.7.2002. However, as per Notification dated 27.6.2002 in G.O.Ms.No.79 CT (B2), the State Government granted exemption from payment of resale tax under Section 3H in respect of resale tax payable on the sale....
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....the smuggling and adultering the diesel or petrol. He further contended that though both the commodities are identical, depending upon the use of the commodities, separate tax can be imposed. While 'kerosene' is for domestic purpose, 'Superior Kerosene Oil or White Kerosene Oil' is for commercial purpose. He also relied on the Parliamentary Committee report to curb the misuse of the kerosene. Moreover, it is his contention that the Government is empowered to fix different rates for a given commodity which has different usages and, therefore, the contention of the appellants that the classification of the Kerosene into two different entries in the said Eleventh Schedule is arbitrary, is not acceptable and the learned single Judge has rightly rejected the aforesaid contention and it needs no interference from this Court. In support of his contention he placed reliance on the decisions of the Hon'ble Supreme Court in (1987) 66 STC 1 (Commissioner, Sales Tax, U.P. v. Agra Belting Works) and (1994) 94 STC 93 (Sales Tax Officer, Sector IX, Kanpur v. Darling Dairy Products and another). 6. From the averments made and the materials on record, it is seen that "Kerosene"....
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....t Schedule attracting a rate of sales tax of 30 per cent, whereas other medicinal preparations shown under item No.95 were subjected to 7 per cent tax, which was later increased to 8 percent. The manufacturers of ayurvedic medicines filed a writ petition challenging the higher levy of sales tax on arishtams and asavas on the ground that such imposition of higher tax was discriminatory and it discourages import of such preparations from the neighbouring State of Kerala and thus infringed Article 301 of the Constitution of India. It was the contention of the Government that such higher tax was introduced to curb the abuse of medicinal preparations for their alcoholic content by drink addicts and to eliminate the mushroom growth of ayurvedic pharmacies preparing sub-standard arishtams and asavas for purposes other than medicinal use. The High Court dismissed the writ petition. On appeal, the Hon'ble Supreme Court, reversed the decision of the High Court by holding that arishtams and asavas were ayurvedic medicinal preparations and there was no reason why they should be treated differently and the reason behind the higher rate of 30 per cent on the turnover of arishtams and asavas ....
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....s rate i.e. 16%. If the dealer opts to sell the packing material and cement separately he has to pay tax at a higher rate i.e. 20% on cement only. The dealer is not left without any option. He can exercise one of the two options and pay the tax accordingly." 9. Though Arya Vaidya Pharmacy case was distinguished by the aforesaid subsequent decision in Associated Cement Companies Ltd., the latter decision was relied on by the appellants to contend that in the said decision classification of the same commodity i.e., cement is impermissible and would amount to discrimination being violative of article 14 of the Constitution of India. 10. The aforesaid subsequent decision in Associated Cement Companies Ltd., has also been distinguished and explained away by the Hon'ble Supreme Court in Deepak Fertilizers & Petrochemicals case and therefore the appellants cannot take any shelter under those decisions. 11. The contention of the learned counsel for the respondents is that the amendment made to 11th Schedule by the Legislature is within its competence and it has got power by delegated legislation to introduce an item into Schedule by virtue of Section 59(1) and even that becomes a pa....
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....o selling the product to the licenced retail outlets, some of which are located on highways. 15. It is indicated that in order to prevent mis-use / diversion of imported Kerosene for adulteration, the Government notified the Kerosene (Restriction on Use and Fixation of Ceiling Price (Amendment) Order, 1998 incorporating certain regulations on sale of imported Kerosene. As per the provisions of the said Notification, no person shall sell or can use imported Kerosene under Parallel Marketing Scheme as fuel or additive to the fuel in the automobiles and the parallel marketers shall file the 'end-use certificates' from their industrial consumers and also furnish customer wise sales on a quarterly basis to the civil supplies authorities of the State Governments. 16. From the aforesaid Report, it is further seen that the Ministry of Petroleum and Natural Gas had requested the Ministry of Finance to consider levying of additional Excise Duty on PMS Kerosene with a view to contain adulteration of PMS Kerosene in Diesel and the Ministry had also requested the State Governments to increase Sales Tax on PMS Kerosene at par with Diesel. Heeding to the request, the State Government of....
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....pinion that the Government should make it mandatory to colour the imported kerosene also with a colour different from blue which is meant for PDS. " 19. The report consists of certain annexures. Annexure-1I of the Report gives the details of the cases registered for misuse of PDS kerosene & Superior Kerosene Oil in automobiles as fuel. As per the said Annexure, about 15,065 litres of both PDS kerosene and SKO worth about Rs. 2,44,023/- and about 26 tanker lorries were seized in 2002, about 22,437 litres worth about Rs. 3,68,866 were seized in 2003 and upto 5.7.2003, 62 cases were registered and about 37,502 litres worth about 6,12,889/- along with 64 vehicles were seized. 20. The aforesaid details make it crystal clear that the misuse of PDS kerosene & Superior Kerosene Oil in automobiles as fuel have been increasing from year to year. In 2002 only 24 cases were registered, whereas in 2003 it increased to 62 and in 2003 upto 5.7.2003, it gone to 64. This would only infer that the persons engaged in misuse of SKO and the kerosene meant for PDS are being increased from time to time . 21. The aforesaid aspect has been highlighted in the Budget Speech made on the Floor of the year 2....