9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2005 (5) TMI 629 - HC - VAT and Sales Tax
Issues:
1. Whether sales tax on the sale of eucalyptus trees by the applicant can be levied in view of Notification No. 6071 dated September 30, 1983. Analysis: The applicant, a private limited company, was registered under the U.P. Sales Tax Act, 1948 and Central Sales Tax Act, 1956. The assessing officer imposed sales tax on the sale of trees made by the applicant for a specific amount. The dispute centered around whether the applicant, not being the owner of any forest or an importer of wood/timber, could be subjected to sales tax on the sale of eucalyptus trees. The notification in question specified that tax would be levied on the sale by the Forest Department, U.P. Forest Corporation, private forest owner, or importer. The Tribunal found that the sale of eucalyptus trees constituted a sale of goods under the U.P. Sales Tax Act, as the trees were cut and removed by the purchaser. It noted that with modern agricultural practices, trees were grown by various organizations to maintain ecological balance, and these planted trees were considered forests. The Tribunal upheld the sales tax liability on the dealer based on the legislative intent to cover trees grown in large quantities. The applicant challenged the Tribunal's decision, arguing that they were not a private owner of a forest, and planting eucalyptus trees did not confer forest ownership. Various definitions of "forest" were presented from dictionaries and legal sources to interpret the term. The principle of interpreting taxing statutes based on commercial understanding rather than technical definitions was emphasized, citing relevant legal precedents. The High Court held that the Tribunal's decision was incorrect, as the applicant could not be considered a private owner of a forest under the notification. It emphasized that ambiguous taxing statutes should not invoke legislative intent to impose tax liability. The Court ruled in favor of the applicant, setting aside the Tribunal's order and absolving the applicant from paying sales tax on the eucalyptus tree sales, with costs awarded to the applicant.
|
