2009 (3) TMI 938 - HC - VAT and Sales Tax

Whether, the Sales Tax Tribunal is justified to hold that rate of tax on imported parts and components of a tractor assembled in the country with more than rd indigenous parts, to be eight per cent on the basis of Notification No. 5079/HA-20/75-S-15/81, dated March 31, 1981? Whether, on the facts and circumstances of the case, the commission amounting to ₹ 2,11,800 received by the assessee is part of turnover under the provisions of the Haryana General Sales Tax Act, 1973? Held that - It is well-settled interpretation of statute that charging section has to be construed according to the plain language used. It is only in case of any ambiguity in the language used that the courts can step in to ascertain the true meaning of the provision which could be other than the one given in the provision. Therefore, we are of the view that the Tribunal has not correctly applied the entry in the notification dated March 31, 1981 to frame the assessment. Accordingly the first question pressed by the dealer-assessee is liable to be answered in favour of the dealer-assessee and against the Revenue. Regarding question No. (ii), this question has not been pressed by the counsel for the dealer-assessee and therefore the same is returned unanswered.

Summary

Issues:
Interpretation of the rate of tax on imported parts and components of a tractor assembled in the country, and the inclusion of commission in turnover under the Haryana General Sales Tax Act, 1973.

Interpretation of Rate of Tax on Imported Parts:
The case involved a dealer-assessee challenging the rate of tax on imported parts and components of a tractor assembled in the country. The Tribunal had initially held that the rate of tax on imported parts should be eight per cent based on a specific notification. However, the High Court analyzed the notification dated March 31, 1981, which stated that tractors manufactured in India should be taxed at four per cent, while tractors imported from outside India should be taxed at eight per cent. The Court emphasized that the notification did not provide for a separate tax rate for imported components used in the manufacturing process. The Court concluded that interpreting the notification to allow separate assessment for imported and indigenous components would go against the plain language of the statute. The Court held in favor of the dealer-assessee, stating that the Tribunal had incorrectly applied the entry in the notification.

Inclusion of Commission in Turnover:
The second question raised in the case concerned whether a commission received by the dealer-assessee should be included in the turnover under the Haryana General Sales Tax Act, 1973. However, the counsel for the dealer-assessee did not press this question during the hearing. As a result, the Court returned this question unanswered.

Conclusion:
The High Court's judgment focused on the interpretation of the rate of tax on imported parts and components of a tractor and the inclusion of commission in turnover under the Haryana General Sales Tax Act, 1973. While the Court ruled in favor of the dealer-assessee regarding the tax rate interpretation, the question regarding the commission in turnover was left unanswered due to non-pursuance by the dealer's counsel.