TMI Blog2011 (3) TMI 1516X X X X Extracts X X X X X X X X Extracts X X X X ..... jecting the Revenue's appeals against the assessee. The learned Tax Board by its impugned order upholding the order of first appellate authority dated July 3, 2000 held in favour of the assessee, a registered dealer of computer and computer accessories and their parts, that goods in question, namely, CVT (constant voltage transformer) and UPS (uninterruptible power source) sold by the assessee are taxable at four per cent as accessories of computer and not under residuary entry at 10 per cent in the assessment years 1995-96 and 1996-97. The assessing authority had imposed six per cent difference tax on these goods, namely, CVT(s) and UPS in the hands of the assessee by the impugned assessment orders, against which both the appeals by the higher appellate forum were decided in favour of the assessee. Hence, these revision petitions at the instance of the Revenue. The learned Tax Board in its impugned order has relied upon two Supreme Court's decisions in favour of the assessee to arrive at the aforesaid conclusion, viz., (i) Union Carbide India Ltd. v. State of Andhra Pradesh reported in [1995] 98 STC 1 (SC) and (ii) Mehra Bros. v. Joint Commercial Tax Officer, Madra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... conjunction with the main capacitor, and this energy storage produces a self generated AC flux field which is indirectly excited from the input winding. The result: Instantaneous voltage regulation. No effect of input transient and spikes on the output. Sinusoidal output waveform. A perfect answer and remedy for all types of electronic equipment. Salient features: No semiconductors or moving parts used, hence very high reliability. Intrinsic current limiting and short circuit protector Output voltage correction within % cycle (10 msecs.) from no load capability. Short term over load capability Energy storage for lines loss up to 3 msecs. at typical loads. Higher input voltage control range, for loads less than rated load Very high line transient/spike rejection capability and excellent input to output isolation characteristic. The relevant tax rate entry No. 50 in the Notification (serial No. 968 S.O. 399) dated March 27, 1995 is reproduced hereinbelow: 50. All types of computers, computer software, electronic typewriters, 4% black and white TC, telecommunication and sound transmitting equipments, electronic exchanges and switching ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cease to be covered by the intended entry simply because a purchaser makes some other use of it. We have to find the intention of the framers of the schedule in making the entry in each case and the best guide to their intentions is the language actually employed by them. The court further held that the term accessory is used in the Schedule to describe the goods, which may have been manufactured for use as an aid or addition. Quoting from the Websters Third New International Dictionary, the definition of the word accessory was defined as an object or device that is not essential in itself but that adds to the beauty, convenience, or effectiveness of something else . The court thus held that where the entry includes parts as well as accessories , which are required for use in projectors or other cinematographic equipment in view of main use of arc carbons to be production of powerful lights used in projectors in cinema(s), they would be taxable in the aforesaid entry No. 4. The court further held that fact that they can also be used for searchlights, signalling, stage lighting, or where powerful lighting for photography or other purposes may be required, could not detra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax, if they were not marked 'for use' with transistors. They did not fall under item 137, (viz., electrical storage batteries). Only those dry batteries or cells which were marked 'for use' with transistors fell under entry 3 prior to September 1, 1976. This judgment was also relied upon by the learned Tax Board in the present case. In Pragati Silicons Pvt. Ltd. v. Commissioner of Central Excise, Delhi reported in [2007] 8 VST 705 (SC); [2007] 9 SCC 470, the honourable Supreme Court while dealing with the question relating to classification of goods plastic name plates for motor vehicles and held them as classified as accessory of motor vehicle and not merely as article of plastic . The relevant portion from para 21 of the judgment relying upon aforesaid three judgments cited (supra), is quoted below (pages 712 and 713 in 8 VST): . . . an 'accessory' by its very definition is something supplementary or subordinate in nature and need not be essential for the actual functioning of the product . . . nameplates add to the convenient use of the motor vehicle. Nameplate serves a very useful purpose inasmuch as it gives an identity to the vehicle. E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 39A at page 469', the said term means 'to mention specifically'. In other words, both 'specify' and 'to mention specifically' have the same meaning. 9. In the light of the abovesaid dictionary meanings and decisions, it cannot be said that the abovesaid voltage stabilizers have been 'mentioned specifically' or stated precisely or in explicit terms or named expressly or particularly in the abovesaid entry 4 or 5 when it uses the expression 'accessories thereof' generally. 10. The net result is, in the present case, entry 41A alone will apply and not entry 4 or 5. Therefore, the order of the Tribunal is set aside and the tax case revision is allowed. No costs. In the case of Katragadda Electronics (P.) Ltd. v. State of A.P. reported in [1988] 71 STC 281 (AP), the Division Bench of the Andhra Pradesh High Court held that voltage stabilizers could not be held to be exempted from sales tax being accessories to electrical energy where such exemption was granted from tax on the sale of electrical energy only. In para 3 of the said judgment rejecting the contention of the learned counsel for the assessee, the court held that what is ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ents on voltage stabilizers are clearly distinguishable from the case in hands and do not support the case of the Revenue at all. In the light of the aforesaid judgments while learned counsel for the Revenue contended that the UPS and CVT in the present case, could not be taxed as accessories of the computer at four per cent and they would be taxable only in residuary entry at 10 per cent. Mr. Nitin Jain, learned counsel appearing for the assessee, vehemently submitted that in view of dictionary meanings and judgments cited by him, the items UPS and CVT were correctly taxable at four per cent only as accessories of computers ; and since these items were referable to specific entries in the notification, there was no question of going to the residuary entry of 10 per cent. He also emphasized that since the words parts and accessories thereof both have been used in the relevant entry No. 50, quoted above, even if UPS and CVT do not form part of computer as such, but only aid or support the computer for their operations, they can certainly be described as accessories thereof and merely because these items can be used in other electrical equipments like refrigerators, etc., als ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ered by a specific entry in the relevant notification, the residuary entry cannot be invoked. The word accessory itself is of wide import and it need not be narrowly construed to mean only the integral parts like mouse, hard disk, floppy, disk drive, CD Rom, etc. The word accessory has already been explained above to mean any instrument or the equipment which aids or supports the operation of other equipment and, therefore, where such goods in question namely, UPS and CVT, admittedly aid or support the operations of computers or laptops, there is no reason to exclude them from the ambit and scope of entry No. 50, quoted above. The contentions of the learned counsel for the Revenue that since they can be used as accessories of other items like refrigerators, TV sets also, therefore, they cannot fall within the scope of entry No. 50 is without any merit. Even if these goods if they were sold along-with refrigerators as accessories thereof, were to be taxed at different rate as applicable thereto, it will not mean that in the hands of the present assessee, a dealer of computers also, it has to be taxed at that very rate, which is applicable to the sale of refrigerator and acces ..... X X X X Extracts X X X X X X X X Extracts X X X X
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