TMI Blog2004 (4) TMI 546X X X X Extracts X X X X X X X X Extracts X X X X ..... t in spite of the above legal position the check-post authorities in the State are consistently detaining the day-old chicks brought from the neighbouring States on the premise that the same is liable to entry tax as a matter of course and that they are insisting for payment of entry tax for onward transportation of chicks. 2.. The petitioners, for the purpose of establishing that there is no liability under the KGST Act to pay tax on the turnover of sale of chicken and its meat, is relying on the Notification S.R.O. No. 1090 of 1999 as amended by S.R.O. No. 7 of 2002. It is stated that under the aforesaid notifications poultry farmers within the State are exempted from payment of sales tax on the turnover of sale of poultry reared by them in their own farms within the State whether hatched by them or not but run on land owned by them and the meat obtained therefrom. The Notification S.R.O. No. 7 of 2002, entry No. 14(ii) also states "own farm does not include farm run on land taken on lease, mortgage, licence or any other arrangement". According to the petitioners they fall under the said clause and therefore there is no liability or payability to any tax under the KGST Act in r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioners' case falls under clause (ii) of entry 14 of the Notification S.R.O. No. 1090 of 1999 as amended by S.R.O. No. 7 of 2002 and therefore since there is no liability or payability to tax on the sale of chicken under the KGST Act reared by them in their poultry farm and there is no liability to entry tax under the Act in view of the decision of the division Bench of this Court mentioned supra. The Special Government Pleader, on other hand, submitted that exemption granted as per the Notifications S.R.O. No. 1090 of 1999 and S.R.O. No. 7 of 2002 are not to the goods as such but only to the dealers who fall within the description in the notifications and further it is available only if poultry farm is conducted in properties owned by such poultry farmers. The Special Government Pleader further submitted that there is no exemption from liability to tax or reduction in the rate of tax on the sale of chicken generally in that it falls under the residuary entry in the First Schedule to the KGST Act taxable at 8 per cent. The Special Government Pleader further submits that chicken includes chicks as well and that exemption under the KGST Act by virtue of the notification is availa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsignment at the check-posts. 6.. The fact that "chicks" are exigible to tax under the KGST Act under the residuary entry in the First Schedule thereto is not in dispute. The only case is that by virtue of the exemption Notifications S.R.O. No. 1090 of 1999 as amended by S.R.O. No. 7 of 2002 the petitioners are exempted from payment of sales tax on the turnover of sale of poultry reared by them in their own farms within the State and the meat obtained therefrom and therefore having regard to the purpose, viz., to curb the evasion of sales tax with which the Act is enacted and in view of the decision of the division Bench of this Court in Emmvee Solar Systems' case (2003) 3 KHCACJ 15 they are not liable to pay entry tax on the purchase of turnover of chicks. They have also got a case that by virtue of the amendment to section 3 of the Act since the expression "the rates specified" for the goods in the First Schedule to the KGST Act was substituted by the expression "the tax payable" for the goods as per the KGST Act, 1963 after the amendment, since no tax was payable on the sales turnover of chicken under the KGST Act the charging section is not attracted. The petitioners have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e petitioners is that prior to the amendment of section 3 of the Act the wording of section 3 of the Act was "not exceeding the rates specified for the goods in the Schedule I to the KGST Act" which clearly refers to the rates in the Schedule, but after the amendment there is no reference to any Schedule to the KGST Act but the reference is to "the tax payable for the goods as per the KGST Act". According to the petitioners there is distinction between the rates specified for the goods and the tax payable for the goods, for, the former deals with the rate specified in the Schedule without any reference to the payability while the latter deals with payability of tax only and therefore unless tax is payable there cannot be a liability to entry tax under the Act. I am unable to accept the said contention of the petitioners, for, if such a contention is accepted the words "tax on such goods shall be at such rate as may be fixed by the Government by notification" used in section 3 will be rendered meaningless and otiose. The notification issued under section 3 will also be meaningless. Here it must be noted that the words in section 3 mentioned above are with regard to the measure of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot carry any further. 9.. Though the counsel for the petitioners have relied on the decisions of the Calcutta High Court in Durga Prosad Khaitan v. Commercial Tax Officer [1957] 8 STC 105, the Andhra Pradesh High Court in G. Lakshminarayana v. Commercial Tax Officer [1974] 33 STC 558 and the decision of the Allahabad High Court in M.A. Company v. Assistant Commissioner (Judicial), (Sales Tax) [1964] 15 STC 487 and other cases regarding the meaning of the expressions "tax payable" in the view which I have already taken it is unnecessary to deal with those decisions. However, it can be seen from the decision in M.A. Company's case [1964] 15 STC 487 (All.) it was observed that the sales tax becomes payable when liability to pay tax arises, and liability to pay tax arises by the happening of the taxable event. The taxable event under the U.P. Sales Tax Act, 1948, it is stated, is the sale of goods or their supply or distribution by way of sale and that it is not necessary to wait till the assessment has been completed in order to be able to say that a tax has become payable. The division Bench observed that there is a distinction between the expressions "tax payable" and "tax due ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry meaning of the words chick and chicken tallies with the meaning of the expression chick as a bird judicially interpreted by the Supreme Court. According to me, both chick and chicken will fall within entry 30 of the Schedule to the Act "live chicken and meat". Thus the contention on behalf of the petitioners that these are two different commercial commodities and that chicks are not exigible to tax under the Act cannot be sustained. 13. The only other contention to be dealt with is as to whether by virtue of the exemption available to poultry farmers in the State on the sales turnover of poultry reared by them in their own farm within the State and the meat obtained therefrom under the notifications issued under section 10 of the KGST Act the petitioners are entitled to exemption from payment of entry tax under the Act. S.R.O. No. 7 of 2002 issued with retrospective effect from April 1, 2000 reads thus: "Sl. No. Name of dealer Turnover which is exempted Conditions and restrictions 14 (i) Hatcheries within the State Turnover of sale of chicks hatched by them within the State Nil (ii) Poultry farmers within the State Turnover of the sale of poultry reared by them in their ow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on may also arise as to whether entry tax can be levied on the entry of chicks into local areas in the State. 15.. As I have already noted the question regarding the exigibility to tax under the Act can be decided only after resolution of the disputed questions of facts which I have already mentioned. In these circumstances, it will not be possible for this Court to straight away adjudicate the question regarding the exigibility to entry tax under the Act as sought for by the petitioners. 16.. I accordingly hold that this is a matter which the petitioners have necessarily to raise it before the assessing authority under the Act and it is for the said authority on the basis of materials and evidence to adjudicate the said question in accordance with law. I direct the petitioners to pursue their remedies available under the Act. I make it clear that I have not considered the merits of the contentions of the petitioners that in view of the notifications issued under section 10 of the KGST Act they have no liability to pay sales tax under the said Act and consequently there is no liability to pay entry tax. 17.. Since the petitioners are registered dealers both under the KGST ..... X X X X Extracts X X X X X X X X Extracts X X X X
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