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2010 (9) TMI 979 - HC - VAT and Sales TaxWhether the item pea gravel is a taxable item, under the Tripura Sales Tax Act, 1976 as well as the Tripura Value Added Tax Act, 2004 or not? Held that - The Scheme of the TST Act and the TVAT Act being altogether different, it cannot be contended that since pea gravel or gravel has not been specifically included in the list of taxable goods, the said item shall stand exempted from the payment of VAT under the TVAT Act, despite the residuary entry, namely, entry No. 193 of Schedule II(b) to the Act. In view of the discussion the judgment and order, passed by the learned single judge, in Writ Petition (C) No. 355 of 2006, holding the item pea gravel to be not a taxable item under the Tripura VAT Act, 2004, cannot be sustained and the same is therefore set aside. Consequently, Writ Appeal No. 79 of 2007 is allowed.
Issues Involved:
1. Whether "pea gravel" is a taxable item under the Tripura Sales Tax Act, 1976 (TST Act). 2. Whether "pea gravel" is a taxable item under the Tripura Value Added Tax Act, 2004 (TVAT Act). Detailed Analysis: 1. Taxability of "pea gravel" under the TST Act: The court examined whether "pea gravel" was included as a taxable item under the TST Act. Initially, the item "gravel" was not listed in the Schedule of taxable goods. However, the 8th Amendment to the TST Act, effective from February 28, 2000, included "gravel" in the Schedule of taxable goods. The court noted that "gravel" was a genus, and "pea gravel" was its species. Therefore, "pea gravel" was considered taxable under the amended TST Act from February 28, 2000. The court referenced the definition of "gravel" from "Engineering Materials" by Surendra Singh, which described gravel as water-worn pebbles of any kind of stone up to 7.5 cm in diameter. This definition supported the inclusion of "pea gravel" as a type of gravel. Consequently, the court upheld the decision that "pea gravel" became taxable under the TST Act from February 28, 2000. 2. Taxability of "pea gravel" under the TVAT Act: The court analyzed whether "pea gravel" was taxable under the TVAT Act. The TVAT Act, which repealed the TST Act, included Schedule II(b) listing goods taxable at 12.5%. Entry 67(iv) included "Black stone, kota stone or any other natural stone," and Entry 193 was a residuary entry for miscellaneous items not covered in other schedules. The court noted that "pea gravel" was not specifically listed in the exempted goods under Schedule III of the TVAT Act. Since "pea gravel" was not covered by any specific entry in Schedules II(a), II(b), II(c), or II(d), it fell under the residuary entry (Entry 193) and was thus taxable at 12.5%. The court rejected the argument that "pea gravel" should be exempt from VAT due to its absence in specific taxable entries, emphasizing the different schemes of the TST Act and TVAT Act. Consequently, the court overturned the learned single judge's decision, holding that "pea gravel" is taxable under the TVAT Act. Conclusion: The court concluded that "pea gravel" is taxable under the TST Act from February 28, 2000, and under the TVAT Act, as it falls under the residuary entry for miscellaneous items. The appeal challenging the taxability under the TST Act was dismissed, while the appeal regarding the TVAT Act was allowed, setting aside the earlier judgment that exempted "pea gravel" from VAT. No order as to costs was made.
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