1995 (7) TMI 384 - HC - VAT and Sales Tax

Summary

Issues:
Interpretation of entry 1 of the Third Schedule to the Andhra Pradesh General Sales Tax Act, 1957 regarding stoker coke exemption.

Detailed Analysis:
The case involved a tax revision under section 22(1) of the Andhra Pradesh General Sales Tax Act, challenging the Sales Tax Appellate Tribunal's decision on the classification of stoker coke for tax exemption. The key question was whether stoker coke manufactured from coal falls within the meaning of entry 1 of the Third Schedule to the Act, which determines the tax liability on second sales of declared goods.

The respondent, a dealer in coal and coke, claimed exemption for the turnover of second sales of stoker coke, arguing that it falls within declared goods and should be taxed only at one point. Initially, the assessing authority allowed the exemption, but the Deputy Commissioner revised the assessment, including the exempted turnover in the assessable turnover. On appeal, the Sales Tax Appellate Tribunal reversed the Deputy Commissioner's decision, reinstating the exemption for stoker coke second sales, leading to the Revenue filing a revision against the Tribunal's order.

The crux of the issue was whether stoker coke, branded as Charminar coke, falls within the scope of the first entry of the Third Schedule, which dictates a single point tax on declared goods. The legal debate centered on the interpretation of the term "coke in all its forms" as mentioned in the Third Schedule, which includes coal and coke but excludes charcoal, subject to a specific tax rate at the point of first sale in the State.

Referring to the Central Sales Tax Act and precedent cases, the Court analyzed the broad definition of "coke in all its forms," concluding that it encompasses stoker coke based on established dictionary meanings and industry references. The Supreme Court's decision in India Carbon Ltd v. Superintendent of Taxes, Gauhati, clarified that the term "coke" should be interpreted broadly to include various forms like petroleum coke, supporting the inclusion of stoker coke within the ambit of the Third Schedule's entry 1.

Ultimately, the Court upheld the Tribunal's decision, dismissing the tax revision case and affirming that stoker coke qualifies for exemption under entry 1 of the Third Schedule. The judgment highlighted the comprehensive analysis of the term "coke in all its forms" and its application to stoker coke, emphasizing the legislative intent to provide tax relief for certain declared goods.