2011 (10) TMI 569 - HC - VAT and Sales Tax

Summary

Issues: Interpretation of sales tax rate on aluminum conductors under a specific notification for the assessment year 1996-97.

Analysis:
1. The revision petition was filed by the petitioner-Revenue against the order of the learned Tax Board, which dismissed the Revenue's appeal regarding the correct sales tax rate applicable on the sale of aluminum conductors manufactured by the respondent-assessee for the assessment year 1996-97.

2. The petitioner argued that aluminum conductors being electrical goods should be taxed at 12 per cent based on a Division Bench decision, while the respondent contended that rectification powers under section 37 could not be used for a debatable issue like this.

3. The respondent further argued that the aluminum conductors did not fall under the specific entry in the notification, and thus, were rightly taxed at 10 per cent under the residuary entry, not warranting the additional two per cent tax under entry 81.

4. The court held that the aluminum conductors for power transmission did not fit the description of electrical goods under entry 81 of the notification, and the assessing authority misapplied the Division Bench decision in imposing the higher tax rate, leading to the rejection of the Revenue's appeal.

5. The court found that the assessing authority misinterpreted the Division Bench judgment and applied the incorrect tax rate, concluding that the rectification under section 37 was not justified, and the additional tax of two per cent was not applicable to the respondent-assessee.

6. Consequently, the court dismissed the revision petition by the Revenue, upholding the decision of the Tax Board, and ruled that no interference was warranted in the revisional jurisdiction under section 86 of the RST Act.