1996 (3) TMI 522 - AT - VAT and Sales Tax

Summary

Issues Involved:
1. Taxability of H.R. coil and skelp in coil under the Entry Tax Act.
2. Classification of H.R. coil and skelp in coil as iron sheet or strips.
3. Validity of the assessment order dated December 23, 1994.
4. Applicability of definitions from other statutes to the Entry Tax Act.

Issue-wise Detailed Analysis:

1. Taxability of H.R. coil and skelp in coil under the Entry Tax Act:
The applicant argued that no tax is payable on H.R. coil and skelp in coil as they are not specified goods under the Entry Tax Act. They contended that these items are iron sheets in coil form and should be taxed at Rs. 10 per metric tonne (p.m.t.) if taxable. The respondents, however, classified these items under item No. 53(d)(iii) of the Schedule to the Entry Tax Act, treating them as strips of iron and steel, thereby levying tax at one per cent ad valorem.

2. Classification of H.R. coil and skelp in coil as iron sheet or strips:
The applicant maintained that H.R. coil and skelp in coil are iron sheets with varying dimensions and should not be classified as strips. They argued that "skelp in coil is nothing but H.R. coil" and provided dimensions to support their claim. The respondents countered by referring to commercial literature and definitions from the Bureau of Indian Standards, asserting that both H.R. coil and skelp in coil are strips. The Tribunal examined the definitions from IS: 1956 (Part III)-1975 and IS: 1956 (Part IV)-1975, concluding that H.R. coil and skelp in coil are indeed strips as per the standards and commercial literature.

3. Validity of the assessment order dated December 23, 1994:
The applicant challenged the assessment order, arguing it was illegal and without jurisdiction. They claimed that the respondent's action of levying tax at one per cent ad valorem was inconsistent with earlier assessments where tax was charged at Rs. 10 p.m.t. The Tribunal found that the materials imported were strips in coil form and thus correctly classified under item No. 53(d)(iii) of the Schedule to the Entry Tax Act, validating the assessment order.

4. Applicability of definitions from other statutes to the Entry Tax Act:
The applicant contended that definitions from the Central Excises and Salt Act, 1944 should not be applied to the Entry Tax Act, emphasizing that the Entry Tax Act is a State Act. The Tribunal, however, considered definitions from the Bureau of Indian Standards and commercial literature from the Steel Authority of India Limited to determine the appropriate classification. The Tribunal concluded that the definitions provided in these authoritative sources supported the respondents' classification of the imported materials as strips.

Conclusion:
The Tribunal dismissed the application, affirming that H.R. coil and skelp in coil are strips as per item No. 53(d)(iii) of the Schedule to the Entry Tax Act and are thus taxable at one per cent ad valorem. The operation of the judgment was stayed for eight weeks upon the applicant's request. The decision was unanimous among the judges.