TMI Blog2018 (7) TMI 147X X X X Extracts X X X X X X X X Extracts X X X X ..... d to “taxable turnover” by a later notification dated 29th April 2006. The Government, by virtue of the said notification dated 31st March 2006, do not intended to compute the lump sum tax of a manufacturer of bakery items on the basis of his total turnover. The very purpose of the composition scheme would be in jeopardy if the payable tax by a dealer is substituted by percentage of his taxable and non-taxable turnover. Turnover tax not leviable - appeal allowed - decided in favor of appellant. - R/TAX APPEAL No. 1043 of 2014 With R/TAX APPEAL No. 1044 of 2014 With R/TAX APPEAL No. 1045 of 2014 With R/TAX APPEAL No. 1046 of 2014 With R/TAX APPEAL No. 1047 of 2014 With R/TAX APPEAL No. 1048 of 2014 With R/TAX APPEAL No. 1049 of 2014 And R/TAX - - - Dated:- 15-6-2018 - MR. AKIL KURESHI AND MR. B.N. KARIA, JJ. For The PETITIONER : Mr UCHIT N SHETH, Advocate For The RESPONDENT : Mr CHINTAN DAVE, AGP ORAL JUDGMENT ( PER : HONOURABLE Mr. JUSTICE AKIL KURESHI) In this group of Appeals, the following questions of law have been framed : [ 1] Whether the Gujarat Value Added Tax Tribunal was justified in holding that lump sum tax is paya ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... during a given period after deducting the amount of sale price; if any, refunded by the dealer to a purchaser in respect of any goods purchased and returned by the purchaser within the prescribed period. Term total turnover is defined in Section 2 [34] as under: 2 [34] total turnover means aggregate of the following transactions effected by a dealer : ( a) turnover of sales or purchases of goods within the State whether such sales or purchases of goods are taxable or exempt under this Act; ( b) turnover of sales of goods in the course of inter- State trade or commerce; ( c) turnover of sales of goods in the course of export of goods out of the territory of India; ( d) turnover of sales by a dealer on his own account and also on behalf of his principal. Section 5 of the Act pertains to exemptions . Subsection [1] thereof provides that the sales and purchases of the goods specified in Schedule-I shall be exempt from tax subject to the conditions and exceptions set-out therein against each of them in column 3 of that Schedule. Under sub-section [2] of Section 5 of the Act, the State Government can by issuing notification exempt a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rn over does not exceed ₹ 75 lakhs to pay lump sum tax in lieu of the amount of tax payable under Section 7 of the Act. Proviso to Clause (a) is couched in a negative language and provides exclusion when it provides that the Commissioner shall not grant permission to pay lump sum tax to a dealer in categories specified in Clauses (i) to (vi) thereof. Clause (iv) contained therein pertains to a dealer who is engaged in the activity of the manufacture other than such activity as the State Government may, by an order in writing specify. In plain terms, therefore, ordinarily a dealer engaged in the manufacturing activity would not be entitled to composition of tax provided under sub-section [1] of Section 14, unless the manufacturing activity in question has been specified for exclusion from such treatment by the Government by an order in writing. As per sub-section [3] of Section 14, a dealer who is permitted to pay lump sum tax is not entitled to certain benefits, such as to claim tax credit in respect of tax payable by him on his purchases or charge any tax on his sales invoice in respect of the sales on which lump sum tax is payable. It is in context of this proviso that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r in the said notification. In other words, in case of the dealers, who want to pay lump sum tax in lieu of normal tax, the rate of tax prescribed was one-half per cent. This one-half per cent was to be computed as per notification dated 31st March 2006 on the total turnover of the dealer, which was quickly corrected to taxable turnover by a later notification dated 29th April 2006. We have noticed that the Statute carries three distinct and different definitions of terms turnover of sales , taxable turnover and total turnover . If we, however, peruse these definitions more minutely, it would emerge that definition of term turnover of sales contained in Section 2 [33] of the Act refers to aggregate of the amount of sale price received or receivable by a dealer in respect of any sale of goods made during a given period minus the deduction of the amount of sale price, if refunded by the dealer in respect of any goods purchased but returned by the purchaser within the prescribed period. The definition of the terms taxable turnover and total turnover use this term turnover of sales as the base. Term taxable turnover broadly excludes those sales which are not subject ..... X X X X Extracts X X X X X X X X Extracts X X X X
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