1994 (10) TMI 281 - HC - VAT and Sales Tax

Summary

Issues:
- Interpretation of tax liability on turnover relating to sales of transmission beltings under Andhra Pradesh General Sales Tax Act, 1957.
- Application of Schedule I and Schedule IV of the Act to determine tax exemption eligibility.
- Conflict between specific provision (entry 101 of Schedule I) and general provision (entry 5 of Schedule IV) in tax assessment.
- Consideration of legal precedent in determining tax liability under changed statutory provisions.
- Petitioner's failure to object to the assessment based on the amended law.

Analysis:
The High Court of Andhra Pradesh heard a writ petition filed by M/s. Goodyear India Limited concerning the tax liability on the turnover from sales of transmission beltings for the assessment year 1986-87. The petitioner contended that transmission beltings should be exempt from tax under entry 5 of Schedule IV, as per a previous Division Bench judgment. However, the Commercial Tax Officer assessed the turnover as taxable under entry 101 of Schedule I, which was inserted in 1976 to include specific items like transmission beltings for taxation at the point of first sale in the State.

The Court considered the conflicting provisions of entry 101 of Schedule I, which specifically included transmission beltings for taxation, and entry 5 of Schedule IV, which exempted cotton fabrics. The judgment in a previous case involving the same petitioner held that transmission beltings were cotton fabrics and exempt from tax. However, the Court emphasized that the subsequent insertion of entry 101 in Schedule I changed the tax liability, making transmission beltings taxable at the prescribed rate.

The Court relied on the principle that in case of a conflict between a special provision and a general provision, the special provision prevails. Despite the previous judgment considering transmission beltings as cotton fabrics, the amended law under entry 101 of Schedule I made them taxable. The Court noted that the petitioner did not raise any objection to the changed law during assessment. Consequently, the Court dismissed the writ petition, stating that the petitioner was not entitled to claim exemption based on the previous judgment.

Additionally, the Court rejected the oral application for leave to appeal to the Supreme Court, stating that the case did not involve any substantial question of law of general importance requiring Supreme Court intervention. The writ petition was ultimately dismissed, and no costs were awarded.

In conclusion, the judgment clarified the tax liability of transmission beltings under the Andhra Pradesh General Sales Tax Act, emphasizing the impact of statutory amendments on tax assessments and the importance of timely objections to changed legal provisions during assessment procedures.