TMI Blog2016 (11) TMI 1321X X X X Extracts X X X X X X X X Extracts X X X X ..... ry 71-A in Schedule 'C', hence will be taxable irrespective of its end use. Appeals disposed off. - VATAP No. 44 of 2012 (O&M) - - - Dated:- 23-11-2016 - MR. RAJESH BINDAL AND MR. HARINDER SINGH SIDHU, JJ. For The Appellant : Mr. Sandeep Goyal and Mr. Rishab Singla, Advocates For The Respondent : Ms. Mamta Singla Talwar, Deputy Advocate General, Haryana RAJESH BINDAL,J. 1. This order will dispose of VATAP Nos. 44, 45, 101, 102, 132, 133, 143, 165 and 166 of 2012, as the legal issues involved therein are common. 2. The facts have been noticed from VATAP No. 44 of 2012. The appeal has been filed by M/s Haryana Pump Manufacturers Association raising the following substantial questions of law: (i) Whether on the facts and circumstances of the case, the Ld. Tribunal was justified in holding that submersible pumps are covered under Entry 71A of Schedule 'C' and not under Entry 1(D)(9) of Schedule 'B', appended to the HVAT Act, 2003 and therefore taxable @ 4%? (ii) Whether on the facts and circumstances of the case, the Ld. Tribunal was justified in upholding the order of Financial Commissioner that submersible pumps are classified unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ower implement and item No.9 contained therein provides for agricultural pumping sets of all kinds including submersible pumps. It also contains list of various components thereof. All the items mentioned in Entry No.9 are tax free. The submission is that the submersible pumps of all kinds mentioned in the entry included submersible pumps upto 5 HP, hence, are exempted from tax. It was being so understood and implemented by the authorities under the Act. Amendment was carried out in Schedule 'C' appended to the Act. Item No.71-A was added regarding submersible pumps upto 5 HP. The issue arose at that stage for which the appellant sought clarification. Before addition of Entry 71-A in Schedule 'C', there was no distinction with reference to capacity of pumping sets for the purpose of exemption. The parts of the pumping sets as have been mentioned in Entry 1(D)(9) of Schedule 'B' cannot be read to mean that submersible pumps upto capacity of 5 HP would be taxable. 6. It was further submitted that once same item is contained in two entries, the one more beneficial to the assessee is to be preferred. As the submersible pumps are mentioned in Entry 1(D)(9) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The onus is not on the State rather it is on the assessees as they are trying to claim that the goods manufactured by them fall in Schedule 'B'. 10. Heard learned counsel for the parties and perused the paper book. 11. Relevant entries in Schedules 'B' and 'C' are extracted below: Schedule 'B' Sr. No. Description of goods 1 Agricultural implements and irrigation equipments used for agricultural purposes as detailed below:- D. Power implements 1-8 Non-relevant 9 Agricultural pumping sets of all kinds including submersible pumps and sprinkler irrigation system equipments and drip irrigation system and their following components, namely:- (i) Control units (ii) Fertilizer applicator/injecting equipments (iii) Dripper/Emitter/Mixee/Sprinkler/Spinner (iv) Filteration units:- Mesh/Screen/Sand/Gravel (v) Distribution tube/Micro tube (vi) Built-in-Drip-in-Line ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the aforesaid entry shows that it is quite wide in application. It encompasses within it pumping sets of all kinds including submersible pumps and sprinkler irrigation system equipments and drip irrigation system and their specified components. Upto June 30, 2006 there was no other entry containing submersible pump. From a plain reading of the Entry 1(D)(9) in Schedule 'B' it is evident that initially complete systems i.e. (i) pumping sets including submersible pumps; (ii) sprinkler irrigation equipments; (iii) Drip irrigation system, have been mentioned. Thereafter a list of components thereof has been provided. The components as provided in the list can be of use for any of the complete sets meant for the purpose of irrigation as mentioned in the Entry. The list of components cannot be said to be exhaustive in the sense that all different parts used for the complete set of agricultural equipments mentioned in the entry have not been provided. However, the exemption will be available to only those components as mentioned in the list if sold separately. 16. The case of the appellant is that the entry clearly includes pumping sets of all kinds including submer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ence was made to Collector of Central Excise, Shillong v. Wood Craft Products Ltd., (1995) 3 SCC 454 to opine that resort can be made to a residuary heading when by liberal construction specific Entry cannot cover the goods in question. In this case, electronic cash registers were found to be covered in the entry providing for cash register as one of the goods. 18. As far as the contention raised by learned counsel for the appellant regarding submersible pumps of the capacity upto 5 HP being exempted even after 1.7.2006 despite addition of Entry 71-A in Schedule 'C' is concerned, the contention is misconceived as Note:4 appended to Schedule 'C' clearly provides that the goods of the description contained in Schedule 'C' shall be deemed to have been excluded from Schedule 'B'. 19. Once it is clearly specified in Schedule 'C' itself that whatever contained therein is deemed to have been excluded from Schedule 'B', there is no scope for accepting the contention raised by learned counsel for the appellant that there are two competing entries one contained in Schedule 'B' and one contained in Schedule 'C' and one mo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hus while agricultural pump sets are exempt in Haryana, other pump sets are taxable @ 12.5% while these are taxable @ 4% in Punjab and Delhi. It is therefore, proposed that rate of tax on non-agricultural centrifugal, mono block and submersible pumps and parts thereof may be reduced to 4%. As pump sets for industrial use can be purchased on payment of tax @ 4% and those for agriculture use are exempt from tax, the reduction in rate of tax will affect small segment of market only i.e. like those used in homes etc. and financial implications of the proposal will not be very significant. It may be further added that it would be difficult to enforce a rate of tax on a commodity based upon user principle. There is no mechanism to check whether a pump is being sold for agricultural purposes or nonagricultural purposes. So it appears advisable either to tax all types of pump sets at a uniform rate of 4% or if the Government does not wish to tax pump sets for agricultural purposes at all, then to exempt pump sets of 5 HP and above from tax and tax pump sets of lower capacity which are not generally used for agricultural purposes @ 4%.'' 22 . A perusal of the aforesaid note s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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