2017 (3) TMI 1653 - HC - VAT and Sales Tax

Whether the abovementioned fuels like natural gas, furnace oil, diesel oil and naphtha would come within the meaning of the expression raw materials processing materials or consumable stores ? Held that - the issue is covered by the decision in the case of Ami Pigment Pvt. Ltd. and Others vs. State of Gujarat 2010 (2) TMI 1068 - GAUHATI HIGH COURT , where it was held that to the extent of use of electricity for the purposes other than manufacturing activities or not connected therewith would not be considered as raw materials, processing materials or consumable stores - petition dismissed.

Summary

Issues Involved:
Interpretation of tax law regarding set off for tax paid on purchase of processing material, reliance on precedent judgment by the Division Bench, and the decision to dismiss the petitions based on the precedent.

Analysis:

Interpretation of Tax Law Regarding Set Off:
The petitions involved a dispute over the use of LDO as fuel in the manufacture of M.S. Patta Patti, whether it qualifies as processing material or consumable stores. The Tribunal allowed the revision applications, holding that the use of LDO qualified for set off under Rule 42 for tax paid on the purchase of the material. The court noted that the issue was covered against the Revenue based on the Division Bench's judgment in the case of Ami Pigment Pvt. Ltd. The petitioner, represented by the Assistant Government Pleader, failed to present any contrary decision to challenge the reliance on the Ami Pigment Pvt. Ltd. case.

Reliance on Precedent Judgment by Division Bench:
The court emphasized that the issue in the present petitions was squarely covered against the Revenue by the Division Bench's decision in the Ami Pigment Pvt. Ltd. case. The Tribunal heavily relied on this precedent in reaching its judgment to allow the set off for tax paid on the purchase of the processing material. The court highlighted that the learned Assistant Government Pleader could not point out any contradictory decision to challenge the applicability of the Division Bench's ruling.

Decision to Dismiss the Petitions Based on Precedent:
Considering that the issue at hand was already settled by the Division Bench's judgment in the Ami Pigment Pvt. Ltd. case, the court found no reason to interfere with the impugned judgment and order passed by the Tribunal. Consequently, both petitions were dismissed based on the established precedent. The court's decision to dismiss the petitions was based on the clear application of the precedent set by the Division Bench, leaving no room for further legal intervention in the matter.