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Savita Oil Technologies Pvt. Ltd. Versus Deputy Commissioner of Commercial Taxes (Audit) -3. 5, Commissioner of Commercial Taxes

2016 (1) TMI 189 - KARNATAKA HIGH COURT

Levy of entry tax on Coolants - whether or not it is a petroleum by product - Karnataka Tax on Entry of Goods Act 1979 - various petroleum products including lubricating oil to be taxable under the KTEG Act at the rate of 5% - Held that:- The notices Annexures-D Series are quashed. Liberty is reserved to the 2nd respondent-clarifying authority to have the ‘coolant’ manufactured by the petitioner, tested, and examined in a manner known to law over the genuineness of the claim of the petitioner re .....

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nd C will have no application to the case of the petitioner. - Writ Petition Nos. 36589-36593/2015 (TAX) - Dated:- 1-12-2015 - Ram Mohan Reddy, J. For the Appellant : Sri. K P Kumar, Sr. Adv For the Respondent : Sri. S V Girikumar, AGA ORDER Petitioner a registered trader under the Karnataka Tax on Entry of Goods Act 1979 (for short the KTEG Act ) engaged in the manufacture and sale of petroleum products and wind power generation, also manufactures transformer oils, liquid paraffin, lubricating .....

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the said notification into a local area for consumption, use or sale therein. Serial No.1(vii) of the said notification provides for various petroleum products including lubricating oil to be taxable under the KTEG Act at the rate of 5%. For the Assessment years 2003-04 through to 2010-11, petitioner paid entry tax at the rate of 5% on the value of lubricating oil brought into the State of Karnataka. In addition, petitioner paid entry tax on all other petroleum products which were caused entry b .....

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t is the further assertion of the petitioner that coolants are neither classifiable as lubricating oils nor as petroleum products and as such, are not liable to tax under the provisions of the KTEG Act. According to the petitioner assessments were concluded for each assessment year from 2003-04 to 2010-11 permitting exemption claimed by the petitioner on the turn over of coolants, consciously accepting the fact that coolants since not notified are not liable to tax under the KTEG Act. 3. It is s .....

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No.1(vii)(a) of the Table in notification No.FD 11 CET 2002 dated 30.3.2002 . Instead of restricting the clarification to the case of the trader, the 2nd respondent is said to have held that coolant oil is a lubricating oil and a petroleum product eligible to tax under the KTEG Act. 4. On 19.05.2014, one M/s. Poomkudy Agencies Pvt. Ltd. filed another application before the 2nd respondent seeking clarification regarding the applicability of entry tax on purchase of radiator coolant , whence, the .....

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1 to A5) for the assessment years 2005-06 to 2009-10. The proposal was to rectify the assessments orders dated 29.02.2012 (Annexures-A1 to A5) for the assessment years 2005-06 to 2009-10. The proposal was to rectify the assessment orders under Section 17(1) of the KTEG Act by levying tax on the turnover of coolants brought by the petitioner into the State of Karnataka at the rates as set out in the clarifications Annexure B and C . 6. It is the allegation of the petitioner that there being no si .....

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ures-B and C, in addition to declaring that coolants are not lubricating oils or petroleum products and hence, not liable to tax under the KTEG Act. 7. Petitions are opposed by filing statement of objections of the respondents-Revenue stating that Annexures-D1 to D5 are notices to which petitioner may respond hence, the writ petitions being premature are not maintainable. In addition, it is stated that the pleadings disclose factual aspects which the statutory authority would examine and which t .....

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oner for Commercial Taxes, for clarification of its product. 8. The ingredients of coolant manufactured by petitioner, namely, demineralised water and Ethylene Glycol is an organic compound primarily used as a raw material in the manufacture of polyester fibers and fabric industry, and polyethylene terephthalate resins used in bottling, a small percent is also used in industrial applications like antifreeze formulations and other industrial products. It is said that it is odorless, colorless, sy .....

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