9911796707
TMI Blog2014 (7) TMI 702X X X X Extracts X X X X X X X X Extracts X X X X ..... exemption from payment of tax on sale of goods by G.O. Ms. No. 2566 dated June 11, 1980 and therefore no tax need be paid by the petitioner under section 6A of the APGST Act on the turnover relating to purchase of burnt lime. The said claim was accepted by the assessing authority and accordingly the assessments were completed for the assessment years 1987-88 to 1991-92. However, the Deputy Commissioner revised all the said five assessments and got the turnover relating to purchase of burnt lime to tax under section 6A of the Andhra Pradesh General Sales Tax Act. Aggrieved by the same the petitioner filed appeals before the Sales Tax Appellate Tribunal of A. P, Hyderabad. By the common order under revision the Tribunal upheld the decision of the Deputy Commissioner. Hence, these revision cases under section 22(1) of the APGST Act raising the following proposed question of law: "Whether the petitioner is liable to pay purchase tax under section 6A of the Andhra Pradesh General Sales Tax Act in respect of burnt lime notwithstanding the fact that the dealers from whom the petitioner purchased the burnt lime were exempted from payment of sales tax?" We have heard the learned counsel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ver if any of the conditions (a), (b) and (c) of section 7A of the Madras General Sales Tax Act, 1959 is satisfied. It is pointed out by the learned counsel that section 7A is in pari materia to section 6A of the APGST Act. Before adverting to the rival submissions noticed above, it is necessary to look into the relevant provisions of the APGST Act. Section 5 of the APGST Act which provides for levy of tax on sale or purchases of goods and section 6 which provides for tax in respect of declared goods read as under: "5. Levy of tax on sales or purchases of goods.-(1) Save as otherwise provided in this Act, every dealer shall pay a tax under this Act, for each year on every rupee of his turnover of sales or purchases of goods in each year irrespective of the quantum of his turnover at the rates of tax and at the points of levy specified in the Schedules. (2) . . . (3) For the purpose of this section and other provisions of this Act, the turnover which a dealer shall be liable to pay tax shall be determined after making such deductions from his total turnover, and in such manner as may be prescribed. (4) The taxes under this section shall be assessed, levied and collected in suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng to purchase aforesaid at the same rate at which but for the existence of the aforementioned circumstances, the tax would have been leviable on such goods under section 5 or section 6." A reading of section 6A shows that every dealer who in the course of business purchases any goods, the sale or purchase of which is liable to tax under the Act, from a registered dealer in the circumstances in which no tax is payable under section 5 or under section 6 as the case may be and consumes such goods in the manufacture of other goods for sale or consumes them otherwise, shall pay tax on the turnover relating to purchase at the same rate at which the tax would have been leviable on such goods under section 5 or section 6. Section 2(f) of the APGST Act defines "declared goods" as goods declared under section 14 of the Central Sales Tax Act, 1956 to be of special importance in inter-State trade or commerce. Burnt lime is admittedly not one of the declared goods and therefore section 6 is not applicable. It is also not in dispute that "burnt lime" falls under item 212 of the First Schedule to the APGST Act in respect of which single point tax is leviable under section 5 at the point of fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing burnt lime as a raw material is not entitled to claim exemption. It is further contended by the learned Senior Standing Counsel that the ratio laid down in Peekay Re-Rolling Mills (P) Ltd.'s case [2007] 6 VST 541 (SC); [2007] 4 SCC 30 wherein the Supreme Court considered the effect of exemption granted in respect of "declared goods" has no application to the case on hand. It is also submitted by him that in fact the decision in M.K. Kandaswami's case [1975] 36 STC 191 (SC); [1975] 4 SCC 745 wherein the Supreme Court interpreted the scope and object of section 7A of the Madras General Sales Tax Act, 1959, which is in pari materia with section 6A of the APGST Act, 1957 applies to the present case. We have carefully gone through the decisions in Peekay Re-Rolling Mills (P) Ltd.'s case [2007] 6 VST 541 (SC); [2007] 4 SCC 30 and M.K. Kandaswami's case [1975] 36 STC 191 (SC); [1975] 4 SCC 745. In Peekay Re-Rolling Mills (P) Ltd.'s case [2007] 6 VST 541 (SC); [2007] 4 SCC 30, the appellant therein is a registered dealer under the Kerala General Sales Tax Act, 1963 and it carried on business of steel re-rolling mills. The raw material used by the appellant in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o limits placed by section 15 of the Central Sales Tax Act and therefore if iron and steel are subjected to a single point levy of tax at the first point of sale, then there is no question of a second levy or charge at any subsequent point of sale or purchase. It was also contended that in view of section 5(1) read with Second Schedule to the Kerala General Sales Tax Act, the burden of tax could not be shifted to the purchaser. On the other hand, it was contended on behalf of the State that in the case of declared goods the conditions imposed by section 15 of the Central Sales Tax Act have to be complied with and the levy could not be at more than one stage but section 5A of the Kerala General Sales Tax Act operates by its own force in cases where taxable goods did not suffer tax under section 5. Under the above noticed facts and circumstances, having formulated the question as to whether the tax sought to be levied under section 5A of the Kerala General Sales Tax Act would amount to tax at a second stage and therefore violates section 15 of the Central Sales Tax Act, it was held by the Supreme Court that exemption can only operate when there has been a valid levy, for if there wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g dealer the burden of tax can be shifted to the purchaser was not at all gone into, but the court had only explained the scope and object of the charging section, i.e., section 7A of the Madras General Sales Tax Act, 1959. In fact Peekay Re-Rolling Mills (P) Ltd.'s case [2007] 6 VST 541 (SC); [2007] 4 SCC 30 was decided taking note of the ratio laid down in M.K. Kandaswami's case [1975] 36 STC 191 (SC); [1975] 4 SCC 745 with regard to interpretation of section 5A of the Kerala General Sales Tax Act. For the aforesaid reasons, we find force in the submission of the learned counsel for the petitioner that the ratio laid down in Peekay Re-Rolling Mills (P) Ltd.'s case [2007] 6 VST 541 (SC); [2007] 4 SCC 30 applies in all fours to the case on hand and that the fact that in the said decision the Supreme Court dealt with "declared goods" does not make any difference so far as the principle of law laid down with regard to the impact of exemption on the liability to tax is concerned. Accordingly, following the decision in Peekay Re-Rolling Mills (P) Ltd.'s case [2007] 6 VST 541 (SC); [2007] 4 SCC 30, we hold that the petitioner cannot be made liable to pay the purchase ..... X X X X Extracts X X X X X X X X Extracts X X X X
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