1995 (12) TMI 376 - HC - VAT and Sales Tax

Summary

Issues:
1. Classification of stoneware glazed pipes under entry 102 of the A.P. General Sales Tax Act.
2. Interpretation of the expression "water supply and sanitary fittings."
3. Burden of proof on the department regarding the purpose of use of the pipes.
4. Assessment of tax rate based on the classification of goods.

Detailed Analysis:
1. The primary issue in this Tax Revision Case (T.R.C.) before the Andhra Pradesh High Court was the classification of stoneware glazed pipes under entry 102 of the A.P. General Sales Tax Act. The court examined whether the pipes sold by the respondent fell under the specific entry, which would impact the applicable tax rate.

2. The court referred to previous decisions by the Sales Tax Appellate Tribunal and highlighted the importance of applying tests laid down by the Supreme Court in relevant cases such as State of U.P. v. Indian Hume Pipe Co. Ltd. and Deputy Commissioner of Sales Tax v. G.S. Pai & Co. The interpretation of the expression "water supply and sanitary fittings" was crucial in determining the classification of the pipes.

3. Regarding the burden of proof, the court emphasized that it was on the department to establish the purpose for which the pipes were intended to be used. The Deputy Commissioner had gathered some material to support the contention that the pipes should be treated as "sanitary fittings." However, the court found this evidence insufficient to conclusively prove the intended use of the pipes.

4. The court analyzed the contentions of both parties regarding the nature and intended use of the stoneware glazed pipes. The respondent argued that the pipes were meant for drainage purposes by agriculturists and not as traditional sanitary fittings. Despite the department's attempt to link the pipes to sanitary fittings based on exemption records, the court found the evidence lacking and upheld the Tribunal's decision to allow the appeal.

In conclusion, the High Court dismissed the Tax Revision Case, emphasizing the importance of establishing the intended purpose of goods for tax classification purposes.