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2016 DIGILAW 1477 (GUJ)

State of Gujarat v. CEAT Ltd.

2016-07-25

G.R.UDHWANI, K.S.JHAVERI

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JUDGMENT : K.S. Jhaveri, J. 1. By way of this reference, the Tribunal has referred following questions of law for our consideration under Section 69 of the Gujarat Sales Tax Act, 1969. "Whether on the facts and in the circumstances of the case Gujarat Sales Tax Tribunal was justified in law under its order dated 7/2/96 that the product in question would be covered under part (D) of entry 97 of the Schedule II A of the Gujarat Sales Tax Act, 1969 and not under entry 95 or Schedule II A and setting aside the order of the Deputy Commissioner of Sales Tax accordingly." 2. The facts of the case are that one M/s. Ceat Limited, a company registered under the provisions of the Companies Act, 1956, is a registered dealer under the Act. It is a manufacturer of "Fully Computer controlled electronic plain paper copier machine" at Gandhinagar. It applied to Commissioner of Sales Tax under Section 62 of the Act for determination of the rate of tax on such electronic copier machines. The Deputy Commissioner, vide his order dated 15.10.1992 held that the said electronic plain paper copier machines are covered by Entry 95 in Schedule II-A to the Gujarat Sales Tax Act, 1969 and not covered by entry 97 (D) in Schedule-II A of the Act, which is specific entry for "electronic goods". However, the Deputy Commissioner held that other items like toner, developer and silicon drums are covered by entry 97 (D) in Schedule II-A of the Act as parts and components of electronic goods. Being aggrieved by said order, an appeal was preferred before the Gujarat Sales Tax Tribunal being Appeal No. 36 of 1992. The Tribunal allowed the said appeal vide order dated 7.2.1996 and set aside the order of the Deputy Commissioner, and held that sale of said electronic item would be sale of electronic goods covered by entry 97D of Schedule IIA of the Act. Against the said order, the State preferred an application under Section 69 of the Act before the Tribunal for making a reference to the Honourable High Court, which application came to be allowed and the present reference came up before this Court. 3. Ms. Against the said order, the State preferred an application under Section 69 of the Act before the Tribunal for making a reference to the Honourable High Court, which application came to be allowed and the present reference came up before this Court. 3. Ms. Mehta, learned AGP appearing for the appellant-State submitted that "electronic plain paper copier machines" are covered by Entry 95 in Schedule II-A to the Gujarat Sales Tax Act, 1969 and not covered by entry 97 (D) in Schedule-II A of the Act. She further submitted that the Tribunal has committed an error while passing the impugned order and it ought to have accepted the view taken by the Deputy Commissioner, Sales Tax in order dated 15.10.1992. 4. We have heard learned AGP appearing for the State and perused the record. We have also gone through the orders of the Deputy Commissioner as well as the Gujarat Sales Tax Tribunal. We have also gone through the relevant provisions of the Gujarat Sales Tax Act, 1969. While deciding Appeal No. 36 of 1992, in its order dated 7.2.1996, the Tribunal has considered following decisions. (i) Siemens Engineering and Manufacturing Co. of India Ltd. v. The Union of India and Another ( AIR 1976 SC 1785 ) (ii) Siemens India Ltd. v. The State of Gujarat (57 STC 1) (iii) M/s. Kaan v. The State of Gujarat (1993 GSTB Part-I, page 85) (iv) M/s. Patels Airtemp Pvt. Ltd. v. The State of Gujarat (1994 GSTB Part-1, page 63) (v) M/s. Tata Telecom Ltd. v. The State of Gujarat (Appeal No. 41 of 1992, decided on 6-7-1995) (vi) State of Gujarat v. Shah Veljibhai Motichan, Lunawada (23 SEC 288) (vii) M/s. Shree Ram Industries v. The State of Gujarat (34 STC 153) (viii) State of Tamil Nadu v. Blue Star Engineering Co. Madras Pvt. Ltd. (39 STC 194) 5. The Tribunal has also referred to Entries 95 and 97 in Schedule II-A of the Gujarat Sales Tax Act, which provides as under:-- Sr. No. (1) Description of goods (2) Rate of Tax (3) Rate of purchase tax (4) 95 Duplicating machines, duplicators, plain paper copiers, photo copiers and such other apparatus used for duplication or copying ribbons plates and stencils used connection therewith. Eighteen paise in the rupee. Eighteen paise in the rupee. 97 Electronics Goods. No. (1) Description of goods (2) Rate of Tax (3) Rate of purchase tax (4) 95 Duplicating machines, duplicators, plain paper copiers, photo copiers and such other apparatus used for duplication or copying ribbons plates and stencils used connection therewith. Eighteen paise in the rupee. Eighteen paise in the rupee. 97 Electronics Goods. (A) ………… (B) ………… (C) ………… (D) All other electronic goods not falling under (A) (B) (C) above, including- (1) ………… …………… (12) ………… Four paise in the rupee. Four paise in the rupee. 6. From the bare perusal of the Entry 97 it is clear that the same relates to Electronic Goods and Part (D) of Entry 97 covers all other electronic goods not falling under (A) (B) and (C). Therefore, it is clear that the electronic goods which do not fall under Part (A), (B) or (C) of Entry 97 would fall under Part (D) of Entry 97. Not only that the Deputy Commissioner has also held that component parts and spare-parts of the machine in question are covered by Entry 97 (D), therefore, the Tribunal has not committed any error while holding that sale of "Fully Computer controlled electronic plain paper copier machine" would be sale of electronic goods covered by entry 97D of Schedule IIA of the Act. Accordingly, this reference is dispose of. The question posed for our consideration is answered in favour of the assessee and against the revenue and it is held that the Gujarat Sales Tax Tribunal was justified in law under its order dated 7/2/96 that the product in question would be covered under part (D) of entry 97 of the Schedule II A of the Gujarat Sales Tax Act 1969 and not under entry 95 or Schedule II A and it has rightly set aside the order of the Deputy Commissioner of Sales Tax.