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2010 DIGILAW 1052 (KAR)

E. P. PRODUCTS v. STATE OF KARNATAKA

2010-09-30

ASHOK B.HINCHIGERI

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ORDER ASHOK B. HINCHIGERI - Sri K. M. Shivayogiswamy, the learned High Court Government Pleader, is directed to take notice for the respondent Nos. 1 to 3. The petitioner's grievance is over the issuance of the recovery notice, dated May 18, 2010 (annexure F) demanding the payment of differential tax on the turnover arising from the sale of certain goods by the petitioner to BESCOM. Sri Arul K. Alur, the learned counsel for the petitioner, submits that the concessional rate of tax at five per cent for the sale of goods to KPTCL was provided for. The said Government company is reorganized. KPTCL is now only concerned with the production, whereas BESCOM, GESCOM and HESCOM are created for the purpose of distribution of power. However, the necessary notification or circular is yet to be issued for extending the concessional rate of tax to the said newly created companies. The association of the dealers has already represented to the Government for extending the similar relaxation or concession in respect of the sale of goods to the said three companies. The same is pending consideration before the Government. Sri Atul K. Alur also brings to my notice, this court's decision in the case of Pavan Engineering Works, Davangere v. State of Karnataka reported in [2010] 68 KLJ 333. The said case was disposed of in favour of the dealer recording the submission made and the concession shown by the Government counsel. The relevant paragraph of the said decision is extracted hereinbelow : "2. Sri shivayogiswamy, learned counsel for the State - respondent, submits that the commercial tax authorities would not press the proposal to recover the differential rate of tax of Rs. 7,59,840 from the petitioner until a decision is taken by the State over the objections filed by the petitioner and that the authorities would issue a fresh notice under the Act proposing levy of tax and penalty for the suppressed sale not declared in total turnover." This court finds the facts of this case and facts of Pavan [2010] 68 KLJ 333 to be absolutely identical. The Government's stand cannot vary from case to case when the facts of the cases are similar. The Government's stand cannot vary from case to case when the facts of the cases are similar. It is not in dispute that the BESCOM is virtually one of the successors of the KPTCL and that the dealers who supplied the goods to KPTCL were indeed given the concessional rate of tax at five per cent. For the two aforesaid reasons, I allow these petitions in part directing the respondents not to recover the differential amounts from the petitioner, if the petitioner has already paid fiver per cent tax on the supply of goods to BESCOM. The recovery of the amounts therefrom, is ordered to be deferred, till the disposal of the representation pending consideration before the Government. These petitions are disposed of. No order as to costs.