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TMI Blog2019 (11) TMI 4X X X X Extracts X X X X X X X X Extracts X X X X ..... ppeal authority dated 12.7.2013. The first appeal authority had held 'crankshaft' and 'camshaft' used in the compressors in refrigerators are not machinery. However, with respect to rejection of books of accounts and best judgement assessment, the matter had been remitted to the assessing authority. The proceedings, thus remanded, have given rise to two separate revisions being Sales/Trade Tax Revision Nos. 298 of 2018 for A.Y. 2008-09 (U.P.) and 299 of 2018 for A.Y. 2008-09 (Central). Those revisions would be dealt with separately. 2. Heard Sri Rahul Agrawal, learned counsel for the applicant-assessee and Sri B.K. Pandey, learned Standing Counsel for the opposite party-revenue. 3. The present revision has been pressed on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome appliances, and not machinery. To reach that conclusion, the Tribunal has reasoned that machineries are only such items as are used for production and manufacture of other goods. The Tribunal has relied on the definition of capital goods under Section 2(f) of the Act and observed,it includes machinery used for production and manufacture of goods. On such reasoning, the Tribunal has dismissed the appeal filed by the assessee. 6. The aforesaid reasoning appears to be wholly erroneous, inasmuch as, the Tribunal has completely misdirected itself in approach and thus, reached wholly unacceptable conclusions. 7. Entry no. 26 of Schedule-II Part-A reads as under: "26. Machinery, equipment, apparatus, tools, moulds, dies and component spar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eads as under: "4. Levy of tax on turnover of sale.- (1) The tax, payable on sale of goods under this Act, shall be levied and paid on the taxable turnover of sale of- (a) goods named or described in column 2 of the Schedule II, at every point of sale and at the rate of four percent." 10. Thus, in the first place, Section 4(1)(a) read with Schedule-II of the Act provides for rate of tax on goods that have been described in column-2 Schedule-II. Thus, everything else apart, the rate of tax on goods falling under Schedule-II would remain 4%. There exist other Schedules to the Act and parts thereof providing different categorization of goods both on the basis of rates and also use. However, no classification or categorization of any goo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry entry but also that electronic systems, instruments, etc. may be classified under other entries. Entry 90 on the other hand does not contain any words of limitation. The items mentioned therein would cover every species thereof irrespective of the mode of their operation. Cash registering machines are specifically mentioned. In the absence of any limitation or qualification as to the different kinds of cash registering machines, there is no reason to read in any such qualification and limit the entry to particular kinds of cash registering machines. It is significant that by contrast, data processing machines have expressly excluded computers. Were it not so excluded, computers would have also fallen within Entry 90. In fact computers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 14. No such exercise has been carried out by the Tribunal. In fact the Tribunal has got misdirected in forming its opinion on the reasoning, treating the goods to be non-capital goods and therefore not machinery. In that regard the Tribunal has not examined the true scope and ambit of entry 26 Schedule II, Part A, in correct light and it has further erred in relying on section 2(f) of the Act, which is not relevant to interpret the taxing entry, in absence of use of the words 'capital goods', under any of the Schedules to the Act. 15. Even as a general principle, the word 'machinery' and the phrase 'capital goods' are different and may overlap or remain mutually exclusive depending upon the facts of the each case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an industrial establishment and also at a residential establishment would not change its identity and therefore its taxability as a machine. It cannot be treated both as an classified and unclassified goods solely on the basis of its installation, whether at an industrial establishment or a home. 18. In view of the above, order passed by the Tribunal is wholly unsustainable. The same is set aside and the matter is remitted to the Tribunal to pass a fresh order in accordance with law, keeping in mind the observations made above. 19. Accordingly, the question of law is left unanswered. The proceedings in remand may be completed as expeditiously as possible, preferably within a period of six months from the date of production of a certifie ..... X X X X Extracts X X X X X X X X Extracts X X X X
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